Experiences with obtaining a BDC loan in Canada?

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January 01, 2021

by a searcher in Toronto, ON, Canada

Does anyone have any experience working with BDC in Canada? When is the best time to approach them? Should you start building a relationship with them prior to having identified a target? What is their limit on loan size for senior debt (is there an absolute dollar limit or a certain EBITDA multiple)? Are there any other good alternatives for senior debt in Canada besides BDC?

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Reply by a searcher
from Trinity Western University in Vancouver, BC, Canada
I made a connection with a BDC analyst, who advised they loan 70-90% of the buyout. But preferably in that 70-80%. They want to EBITDA multiples in the 3 - 5x from speaking to the analyst. Obviously the lower the better. From the little research I've done it seems like the banks would want to loan only up to the 60-65%. But maybe cheaper?
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Reply by a searcher
in Toronto, ON, Canada
Banks are much cheaper and offer favorable terms despite covs, than BDC. BDC may be more open to different kinds of businesses though.
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