Business Acquisition Loans & Financing Solutions
Strategic Capital for Buying an Existing Business
Acquiring an established business can provide opportunities for ownership, expansion, and long-term growth. However, financing a business acquisition requires more than determining the purchase price.
TDJ Equity Funding helps entrepreneurs, established business owners, and qualified buyers evaluate financing solutions for acquiring existing businesses.
Our strategy-first approach considers the buyer's financial position, the target business's operating performance, purchase structure, available equity, and repayment capacity to help identify suitable financing opportunities.
Business Acquisition Financing Options
SBA 7(a) Business Acquisition Loans
Eligible SBA 7(a) financing may support the acquisition of an existing business, including qualifying transaction expenses and certain working capital requirements.
SBA eligibility, equity injection, ownership requirements, and loan terms depend on the transaction and applicable program guidelines.
Conventional Business Acquisition Loans
Certain banks and commercial lenders provide acquisition financing for qualified buyers purchasing established, financially viable businesses.
These financing programs may require strong buyer qualifications, demonstrated repayment capacity, adequate equity, and appropriate collateral.
Seller Financing Structures
In some business acquisitions, the seller agrees to finance a portion of the purchase price.
Seller financing may supplement senior acquisition debt, depending on lender approval, lien priorities, repayment terms, and applicable subordination requirements.
Business Expansion Through Acquisition
Established companies seeking to acquire competitors, complementary businesses, or additional locations may qualify for acquisition financing based on their existing financial strength and the proposed transaction.
Acquisition Financing With Working Capital
Some business acquisitions require additional capital beyond the purchase price to support payroll, inventory, operational transitions, or immediate business expenses.
Where permitted, eligible financing structures may include acquisition costs and working capital requirements.
What Can Business Acquisition Financing Cover?
Depending on lender guidelines and transaction eligibility, financing may support:
- Purchase of an existing operating business
- Acquisition of eligible business assets
- Qualifying goodwill and intangible assets
- Equipment and inventory included in the transaction
- Eligible closing and transaction expenses
- Working capital associated with the acquisition
- Qualifying business expansion through acquisition
What Do Lenders Evaluate?
Business acquisition lenders typically review both the buyer and the business being purchased.
Buyer Qualifications
- Personal and business credit history
- Industry and management experience
- Available equity contribution
- Financial strength and liquidity
- Existing debt obligations
- Relevant business ownership experience
Target Business Qualifications
- Historical revenue and profitability
- Business tax returns and financial statements
- Cash flow and debt-service capacity
- Existing business liabilities
- Customer concentration and operating risks
- Business valuation and purchase price
- Continuity of operations after acquisition
Transaction Structure
- Letter of intent or purchase agreement
- Sources and uses of funds
- Buyer equity contribution
- Proposed seller financing
- Available collateral
- Post-acquisition working capital
- Repayment capacity and transition plan
Documentation requirements vary by lender and transaction.
Understanding the Business Acquisition Financing Structure
An acquisition may involve several financing components, including:
Senior Acquisition Financing
The primary business acquisition loan provided by an eligible lending institution.
Buyer Equity Contribution
Capital contributed by the buyer, subject to applicable lender and program requirements.
Seller Financing
A negotiated portion of the purchase price financed by the seller, subject to acceptable terms and lender approval.
Working Capital
Additional liquidity to support ongoing business operations following the acquisition.
The objective is to establish a financing structure that supports the purchase while preserving sufficient capital for continued business operations.
TDJ Equity Funding's Strategy-First Process
1. Acquisition Financing Discovery
We discuss the proposed business purchase, buyer qualifications, transaction objectives, purchase price, and anticipated financing requirements.
2. Acquisition Review & Pre-Underwriting
TDJ evaluates relevant buyer financial information, target business performance, available equity, purchase documentation, repayment capacity, and proposed financing structure.
3. Financing Options
Once the acquisition financing request is lender-ready, TDJ identifies suitable financing opportunities and presents available lender terms for consideration.
Ready to Explore Business Acquisition Financing?
Whether you're purchasing your first established business, acquiring a competitor, or expanding through acquisition, TDJ Equity Funding can help evaluate your financing strategy.
Schedule a Business Acquisition Financing Consultation
Business acquisition financing is subject to lender eligibility, underwriting, transaction requirements, and approval. Financing amounts, costs, collateral requirements, and repayment terms vary. TDJ Equity Funding does not guarantee loan approval.
