Business Mergers and Acquisitions

An acquisition loan is a loan given to a company to purchase a specific asset, acquire another business, or for other reasons laid out before the loan is granted. Typically, a company can only use an acquisition loan for a short window and only for the agreed-upon purpose.

Business MergersBuying a business can be incredibly rewarding and lucrative, but obtaining business acquisition financing can only be accessed with an established business or a track record of success in a similar industry. Fortunately, there are alternatives to traditional business loans that can help entrepreneurs take the next step toward business ownership and growth.

Loans for business acquisition are available from various sources, each with flexible payment terms and rates. It is often easier to get a loan to buy a business if you already own an existing business in a similar industry. However, there are also small business acquisition loans available for startups.

Loans to acquire a small business vary in amounts, terms and interest rates, and each of these variables will impact the other. A conventional term loan from a bank for business acquisition is one of the most popular ways to acquire a business. Substantial assets, good personal credit and demonstrated success in business are among the requirements for getting a traditional small business loan.

Refer to this video to learn more about our lending practice around Business Acquisition Transactions:

Avon River Ventures’ M&A Team provides end-to-end valuation, buyer targeting, outreach, negotiation, and deal-closing support. Mergers and Acquisitions (M&A) are one of the most complex business events that involve consolidating companies or assets through various types of financial transactions, including mergers, acquisitions, consolidations, purchasing assets, and management acquisition. Our M&A services are as follows:

  • STRATEGY AND PLANNING: Our M&A Analysts develop a sound acquisition strategy that revolves around the intended gain that the acquirer wants to achieve behind making the acquisition. We categorize M&A objectives into two broad categories: improving financial performance and reducing risks. Based on the corporate analysis, our analysts shortlist multiple companies that meet its search criteria and offer good value.
  • VALUATION ANALYSIS: Our M&A Team collects essential information such as current and past financials, customer and product/services data, employee retention numbers, derive goodwill valuation, etc. that will enable us to further evaluate the target company, both as a business on its own and as a suitable acquisition target.
  • COUNTERPARTY NEGOTIATIONS: We produce several valuation models of the target company to derive a fair valuation, allowing us to construct a reasonable offer. We present the initial request to the target and then mediate and negotiate terms in more detail between the acquirer and the acquirer.
  • DUE DILIGENCE: Due diligence is an exhaustive but the most crucial process, and hence, within our M&A department, we have a separate team that performs the due diligence solely when the offer has been accepted. We perform due diligence to confirm or correct the target company's value assessment. Our team conducts a detailed examination and analysis of every aspect of the target company's operations – its financial metrics, assets and liabilities, customers, human resources, etc.
  • PURCHASE AND SALES AGREEMENT: Once the team is convinced that the due diligence is completed with no significant concerns arising, we execute the final contract for sale. We mediate the transaction decision on the type of purchase agreement, whether it is an asset purchase or a share purchase.
  • CLOSING AND INTEGRATION: Our team closes the acquisition deal and then works with the management teams of the target and acquirer on merging the two firms, essentially their products, services, employee governance, and compliance. Our product integration team starts valuing synergies and often differentiates synergies into: hard and soft. We term Hard synergies as direct cost savings to be realized after completing the merger and acquisition process. Soft synergies are financial synergies, such as revenue increases that the acquirer hopes to recognize after the deal closes. They are "soft" because realizing these benefits is not as assured as the "hard" synergy cost savings.

Structured Financing

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