Financing mergers or acquisitions with ScotPac.
Do you need funding to acquire or merge with another business?
How Can ScotPac Fund a Merger or Acquisition?
We can help you unlock the capital tied up in your business assets to fund a merger or acquisition.
Buying out a company director or purchasing an existing business outright requires a significant investment of capital upfront. As an asset-based lender, we can help you leverage the target’s assets and the business assets you already own to secure funding. You can use accounts receivables, plant & machinery, business property, and even a term loan to raise the capital you need to complete a merger or acquisition.
Our business finance team has over 30 years of experience helping Australian SMEs access flexible and straightforward funding solutions. We’ll put together a tailored finance facility designed to meet the unique needs and circumstances of the deal.
We don’t have conditions with financial covenants, and we’ll happily work with your bank and other lenders to structure a funding solution so that you can quickly capitalize on opportunities to grow your business.
Why ScotPac?We’ve supported Australian SMEs for over 30 years. We unlock the true value of your business so that you take advantage of opportunities to grow.
Who’s it for?
If you are ready to expand your business through acquisition or have an opportunity to cement your market position by combining with another company, a merger and acquisition funding solution can provide the financing you need to invest in your future.
How Does Funding for Mergers and Acquisitions Work?
Asset-based merger and acquisition financing is a straightforward way to raise the capital you need to fund your growth plans.
You can use the target’s assets and the assets you already own to secure funding. A funding facility can be used as an end-to-end financing solution or as a supplementary source of capital used alongside a cash down payment or bank funding.
We provide the financing you need so that you can focus on moving your business forward. Many growing enterprises use asset-based funding as a way to accelerate growth through mergers and acquisitions.
You can use your accounts receivable to secure funding for an acquisition and then use the accounts receivable of the newly purchased business to fund a buyout of the next target. A strategic financing solution can fuel quick expansion and increased market share.
How Is Merger and Acquisition Financing Different From a Bank Loan?
A traditional bank loan is subject to strict lending criteria. The lender will analyze your anticipated earnings and credit score and will typically require property security. This type of funding is often subject to covenants and financial requirements that restrict how you can run your business.
Asset-based merger and acquisition funding is based on the value of the assets that you can provide as security for financing. The funding provider will still be interested in your business circumstances, but the collateral is the primary consideration for funding. This means you can typically access funding much faster, and funding solutions are much more flexible and can be tailored to the needs of your business.
What Security Is Required?
ScotPac merger and acquisition finance solutions are based on the value of the assets used as security. These assets can include accounts receivable, machinery, equipment, business property, and inventory that you or the target business owns.
We do not require any covenants that interfere with your business decision-making or operations. You retain 100% control of your business.
Can ScotPac Fund Alongside a Bank?
Our solutions can be used as a sole source of funding or in combination with bank financing.
We have decades of experience helping our clients to access the funding they need, and we have a great relationship with all of the major banks in Australia. Our expert team is skilled at structuring funding solutions and can work with traditional lenders.
If you can’t access the total amount you need through bank funding, we’ll structure an alternative solution that generates the capital you need to move forward.
If a Bank Is Involved, Can ScotPac Share Securities?
For most ScotPac merger and acquisition financing facilities, the funding is secured against assets like machinery, equipment, and accounts receivables. If a bank is involved, they will typically provide financing based on your credit rating and property security.
You may find that combining asset-based funding and a traditional bank loan provides the capital you need to complete the merger or acquisition.
Do You Require Covenants?
No. Unlike a loan from a traditional lender, ScotPac does not condition covenants as part of the funding agreement. Covenants are necessary for many conventional business funding solutions, but they can also restrict your business.
Our solutions are designed to provide the funding you need to fuel the growth of your business without interference. We believe that you know your company best and should be in control of how you choose to run it.
How Quickly Can I Access Merger and Acquisition Financing?
Every deal involves unique circumstances, but we can usually provide funding much faster than a traditional lender. Our team will work with you throughout the process to make sure it progresses as quickly and as smoothly as possible.
We’ll review the target’s assets and your business assets to find the best funding solution. Our business finance team are experts at unlocking capital, handling accounts receivables, and structuring tailored funding solutions.
While the exact timeline will depend on the unique circumstances and complexity of the deal, we can provide credit facilities for mergers and acquisitions in as little as 2 weeks.
What Are the Different Methods of Financing Acquisitions?
If you are looking to fund the expansion of your business through a merger or acquisition, there are a range of options available to you, including:
- Exchanging Stock
- Paying with Cash
- Initial Public Offerings
- Asset-Based Financing
Here at ScotPac, we provide asset-based funding solutions that can be used as a standalone source of financing or combined with another funding option to complete a merger or acquisition.
Want to learn more about funding for mergers & acquisitions?Enquire now
Call us to discuss how we can finance your business 1300 177 485