How to Finance a Business Acquisition in Canada
Buying an existing business is one of the fastest paths to growth. Here is how to structure the financing for a successful acquisition.
Start an applicationWhy Buy Instead of Build?. Acquiring an existing business gives you immediate revenue, an established customer base, trained employees, and existing processes. It eliminates the startup phase where most new businesses fail.
Types of Acquisition Financing. Senior debt (term loans secured by business assets), seller financing (where the seller carries part of the purchase price), mezzanine financing (subordinated debt), and equity co-investment. Most acquisitions use a combination.
What Lenders Look For. Cash flow coverage of the acquisition debt service (typically 1.25x or better), quality of the target's revenue and client concentration, management experience, and a clear transition plan.
Voxen Acquisition Financing: $500K–$50M. Voxen Capital structures acquisition financing from $500K to $50M with customized terms. We support leveraged buyouts, management buyouts, and strategic acquisitions with flexible collateral arrangements.