Acquisition Finance Australia — Fund Your Next Business Purchase

Structuring the Deal Before You Talk to a Lender

• Share sale versus asset sale — a share sale transfers the whole entity, including its history and liabilities, and lenders will want deeper due diligence; an asset sale isolates the assets and contracts being bought, which can simplify credit assessment but may require separate working capital funding to stand the business up.
• Vendor notes — sellers financing part of the price, typically subordinated to bank debt, can bridge a valuation gap and signal confidence to your lender, but the terms need to be structured so they don't undermine your serviceability test.
• HoldCo / OpCo structures — debt is often raised in a holding company while the target continues trading through its operating entity, with security stapled across both. Getting this structure right affects tax outcomes, lender security, and future exit flexibility.
• DSCR (debt service coverage ratio) — lenders test the target's maintainable EBITDA against total debt servicing, usually wanting cover of 1.25x to 1.5x or more. This ratio, more than the purchase price, determines how much a lender will actually fund.

Why a Tender Beats Going to One Bank

Approach your own bank for acquisition finance and you'll get one view of risk, one appetite for the sector, and one set of covenants. Running a structured tender across the market changes that:

• Different lenders price the same deal very differently depending on their current sector appetite and balance sheet position.
• A competitive process gives you genuine leverage on rate, gearing, and covenant flexibility — not just a take-it-or-leave-it offer.
• Specialist and private credit lenders will sometimes fund structures or gearing levels a major bank won't, particularly for management buyouts or bolt-on acquisitions.

Why Buyers Choose Glenclair Financial