Maclear Project 4UK Ltd
- Written by
- Just P2P
- •
- Updated February 20, 2025
Score C-
4UK Ltd is a Bulgarian company specializing in the production and sale of CBD-infused e-cigarettes, operating since 2022. The company manufactures vapes in various flavors under its own brand and for other brands, having transitioned from outsourced to in-house production in 2023.
The project seeks a €662,000 loan to expand production capacity through purchasing three new production lines and materials for manufacturing 80,000 units. This significant capital investment aims to meet projected demand from contracts, though it would substantially increase the company’s already high leverage.
Investment terms
Loan requested : €662,000
Period : 14 months
Interest rate : 14.8%
Company Contribution : -€
With a total project value of €662,000, 4UK Ltd is seeking to buy new production equipements, with no direct capital contribution from the company. The 14-month loan period is in line with the typical term while the interest rate of 14.8% is also a common interest rate compared to other projects on Maclear (14.7% – 15.1%).
Risk metrics
Debt/Equity Ratio : 8.07 (Very high risk)
LTV (Loan to Value) : 166% (Very high risk)
Credit History Score : 8/10 (Good)
The risk metrics are particularly concerning. The extreme D/E ratio indicates dangerous leverage levels, while the very high LTV suggests inadequate collateral coverage. While the credit history is good, it spans only a short period given the company’s recent establishment, limiting its predictive value.
Business profile
Geographic Location : Bulgaria, EU member state
Industry Sector : Production/Wholesale (CBD E-cigarettes)
Collateral Type : Production equipment and inventory (437 K€)
Operating in Bulgaria gives access to the EU market while keeping operating costs low. The CBD e-cigarette sector has strong growth potential, but remains subject to regulatory oversight. The collateral structure combines existing equipment, new production lines and inventory, guaranteeing tangible assets despite a high LTV ratio.
Positive / Risk factors
Positive factors
- Good credit history (8/10)
- In-house production line established since 2023
- Strong revenue growth (276% in 2023)
- Contracts secured for 2025 totalling €2.2m
- High projected profit margins (33.2%)
- Diversified customer base
- Clear use of funds and expansion strategy
Risk factors
- Very high debt-to-equity ratio (8.07)
- Very high LTV (166%)
- No company contribution to the project
- Exposure to an emerging market
- Regulatory risks in the CBD industry
- Dependence on key suppliers
- Relatively young company
Score C-
The C- rating is justified by the combination of multiple significant risks that create a highly vulnerable investment profile. The extreme D/E ratio of 8.07 and LTV of 166% far exceed high-risk thresholds, indicating dangerous leverage and inadequate collateral coverage. While the company shows positive operational momentum and has secured future contracts, its very limited operating history, significant supply chain dependencies, and the substantial new debt burden create a precarious financial position.
The positive factors, including good credit history and secured contracts, provide some mitigation but are insufficient to offset the fundamental risk factors. This represents a high-risk investment requiring careful monitoring and strong risk management measures.
