It seems that the big banks are calling all the tunes in business transactions right now.
We hear from all quarters that the main financiers are making it very tough to get finance for business acquisitions and that their requirements are changing on a daily basis. And this at the time when many entrepreneurs are seeing opportunity all around, believing there hasn’t been a better time to buy.
Some suggestions from Trio as we sit between all the parties:
- Buyers make sure you are very clear about your prospective financier’s current lending requirements before you delve too deeply into a potential acquisition. Don’t assume what would have worked 6 – 8 months ago will get past the banks today
- Sellers think about the possibility of vendor finance – sure it’s not ideal but if it bridges the gap created by the GFC then it’s worth serious consideration
- Buyers and sellers clarify the situation on valuation of hard assets within the business. What are the bank’s current valuation policies and discount rates? What does an independent valuation throw up?
If you know a finance good-news story drop us a line and we’ll spread the word
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