Business Acquisition Financing Terms in Canada

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October 17, 2024

by a searcher from McGill University in Montreal, QC, Canada

Hi,

Has anyone in Canada successfully financed a business acquisition? If so, would you be willing to share the terms you received from Canadian banks?

I'm curious about loan terms (5, 7, or 10 years), interest rates, and down payment requirements (including if seller financing was an option).

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Reply by a professional
from Nirma University in Toronto, ON, Canada
It is a broad discussion and every transaction is uniqie .As Jalal mentioned , it depends on industry , capital structure , cash flows , transition plan ,new management team etc .avg amortization i have seen is 6-7 years , may be able to get 10 year however its little challenging .
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Reply by a searcher
from New York University in Calgary, AB, Canada
Depends on the company you’re acquiring. Industry and historical cashflow play a strong role. Max amortization I’ve received has been 10 years. Most commercial lenders in Canada are in the 7-10 year range however, some will only go that high with a sweep.
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