EFIC-backed bond opens up the US wastewater market to Brisbane company
Brisbane-based wastewater company, MultiTrode, is expanding its business in the United States with support from the Export Finance and Insurance Corporation (EFIC).
A US$400,000 performance bond, underwritten by EFIC, Australia’s export credit agency, secured MultiTrode’s contract to supply and install new, world-leading equipment that will monitor key waste facilities for a city municipality in the north-eastern United States.
The bond was issued under an on-going arrangement between Liberty Mutual Insurance Company, one of the largest surety bond providers in the United States, and EFIC.
“MultiTrode was unable to obtain a performance bond from the commercial market without providing full cash cover, which would have tied up significant amounts of its working capital. However, through a detailed assessment of the risks and analysing the likelihood of completion, EFIC was able to offer the bond by Liberty Mutual to MultiTrode with minimal impact to their financial resources,” said Robert Dravers, Director of Business Development at EFIC.
In America, many companies expect contractors to provide performance bonds to guarantee 100% of the value of the work they are contracted to provide, particularly in situations that are complex or technically difficult.
This relationship between EFIC and Liberty Mutual makes it easier for EFIC to offer small to medium Australian enterprises wishing to expand their business in the United States access to performance bonds.
“If other small to medium enterprises are looking to grow their exports in the United States, and require bonding arrangements, we are well-placed to respond rapidly to their needs,” said Robert Dravers, Director of Business Development at EFIC.
MutliTrode is expected to complete the installation of the system within six months. The contract and the bond provide for a further one year warranty period.
“We’re delighted that we were able to assist MultiTrode open up a significant export market.”