A UK manufacturer receives funding to develop essential data centres.

Innovations and Initiatives Innovations and Initiatives

Posted by NewAdmin on 2025-02-12 08:38:30 |

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A manufacturer based in Northumberland is expanding its business to focus on the development of crucial data centres after securing financial support from UK Export Finance (UKEF) and Santander UK. Salem Tube, a company that has been in operation since 1992 and primarily served the energy sector, is increasingly receiving orders from developers involved in building data centres, reflecting the growth of this sector.

As the demand for AI and cloud data storage continues to surge, Salem Tube has been actively taking on more contracts related to data centre development. Data centres have become a fundamental component of modern technology, centralizing an organization's IT operations and equipment to store, process, and disseminate data and applications. Due to their importance in housing critical and proprietary assets, data centres are essential for ensuring the continuity of daily operations. There are currently over 7 million data centres worldwide, with businesses and governments either constructing their own facilities or relying on external providers.

These data centres provide a variety of services, including data storage, management, backup, and recovery, as well as supporting productivity applications like email, facilitating high-volume e-commerce transactions, and enabling advancements in fields such as big data, machine learning, and artificial intelligence (AI).

In response to the growing need for data centres, Salem Tube has secured a £3.5 million financing package through Santander UK, with backing from UKEF. This capital will enable the company to take on larger contracts within the data centre market and position itself as a key supplier in this emerging sector. UKEF's General Export Facility (GEF) scheme allows exporters to access working capital facilities, with amounts reaching up to £25 million, facilitating growth for businesses like Salem Tube.

Pat Kendell, Senior Export Finance Manager at UKEF, emphasized that this deal illustrates how government backing can help established manufacturers capitalize on new opportunities in growing industries. By supporting Salem Tube’s move into the data centre sector, UKEF is contributing to job security and boosting exports in the North-East. Mark Ling from Santander UK expressed his delight in helping Salem Tube expand, highlighting the strong collaboration between the bank, UKEF, and the manufacturer.

This funding is also a significant step in Salem Tube’s recovery from the impact of COVID-19, helping it secure overseas contracts in regions like the US and the Middle East. The company is now considering expanding its workforce to meet the increasing demand. This partnership with UKEF has lasted for over five years, with previous support enabling Salem to win new contracts in Africa.

The investment in Salem Tube is part of a broader government strategy to invest in critical tech infrastructure in the UK. This initiative, which includes partnerships with US tech companies to develop new data centres, has brought the total investment in UK data centres to over £25 billion since the current government took office. Continued investment in such infrastructure is vital for boosting the UK's computing power and data storage capabilities, which in turn supports the development of AI technologies like complex machine learning models and algorithms. This progress is also accelerating the adoption of AI in sectors such as healthcare, where it promises to improve quality of life for individuals by enhancing healthcare services.

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