A critical part of making a successful acquisition is negotiating an optimal financing structure. You want a financing mix that will allow for a smooth ownership transition and position your company to flourish in the years to come.
It can be challenging to understand how each type of financing works and finding the right mix can be difficult.
“When properly structured, the financing package will provide you with the flexibility to successfully integrate your acquisition and support your future growth,” says Robert Duffy, a Vice President in BDC’s Growth & Transition Capital team.
Duffy, who has financed dozens of business acquisitions, explains the typical financing package for an acquisition in the example below.
Establish the value of the acquisition target