UK manufacturer wins funding to develop critical data centres

A manufacturer from Northumberland is taking on new business to develop important data centres after securing the support of UK Export Finance (UKEF) and Santander UK.

Salem Tube has traded since 1992 and traditionally served the energy sector, but it is taking on more and more orders from developers of data centres.

As the market for AI and cloud data storage grows rapidly, Salem has been taking on more and more contracts in this area.

Why are data centres so important as technology evolves?

Data centres centralise an organisation’s IT operations and equipment for the purposes of storing, processing and disseminating data and applications.

Because they house the most critical and proprietary assets, data centres are vital to the continuity of daily operations.

Today, there are reportedly more than 7 million worldwide. The majority of business and government entities build and maintain their own or have access to someone else’s if not both, models.

Data centres provide several applications and services, including:

  • Data storage, management, backup and recovery.
  • Productivity applications, such as email.
  • High-volume e-commerce transactions
  • Big data, machine learning and artificial intelligence.

Seizing new opportunities in the industry

Salem has now agreed on a financing package worth £3.5m, which is provided by Santander UK and backed by the government through UKEF.

This gives the business the capital it needs to take on larger data centre contracts and establish itself as a supplier to this emerging sector.

UKEF offers its General Export Facility (GEF) scheme through all the major UK banks and a range of non-bank lenders. This allows exporters to access working capital facilities up to around £25m.

Pat Kendell, Senior Export Finance Manager (North East England), UKEF, commented: “This deal shows how government backing can help established manufacturers to seize new opportunities in the industries of the future.

“By supporting Salem Tube’s move into the data centre market, UKEF is helping to safeguard jobs and boost exports in the North-East.”

Mark Ling, Head of Trade & Supplier Finance, Santander UK, added: “We are delighted to provide further support for Salem Tube’s growth.

“Our partnership and collaboration with both Salem Tube and UKEF demonstrates our commitment to the international growth of businesses in the UK.”

This also helps Salem to complete its rebound from COVID-19 and grow larger than ever. It secured a range of overseas contracts in the US and the Middle East last year and is now considering taking on more employees.

This is the latest phase of Salem’s partnership with UKEF, which has supported the business for over five years and previously helped it win new contracts in Africa.

Fuelling the next generation of tech in the UK

The funding for Salem Tube builds on the government’s partnership with US tech firms to invest in new data centres in the UK.

This took total investment in UK data centres to over £25bn since this government took office, demonstrating a continuous effort to drive growth by partnering with businesses.

Continued investments in critical tech infrastructure like these will provide the UK with more computing power and data storage, providing the necessary infrastructure to train and deploy the next generation of AI technologies, such as complex machine learning models and algorithms.

It also helps the UK roll out AI faster in areas like healthcare, which will help everyone live better and healthier lives.

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