Palmer & Harvey has announced it has agreed to a new lending deal backed by JTI and Imperial Tobacco.

The deal, which has been agreed for an undisclosed sum, is to secure new debt facilities with a group of banks and is backed by the tobacco giants, according to Sky news.

Initially it had been reported the tobacco manufacturers were considering buying shares in the delivered wholesaler, however, they will instead support Palmer & Harvey's borrowings through guarantees.

Tony Reed, chief executive of Palmer and Harvey said: “The refinancing provides us with a strong financial position from which to drive forward Palmer & Harvey and to take advantage of the many opportunities we see in the wholesale and convenience markets.”