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Thanks for dropping in for some hopefully great business info and on occasion some hopefully not too sarcastic comments on the state of Business Financing in Canada and what we are doing about it !

In 2004 I founded 7 PARK AVENUE FINANCIAL. At that time I had spent all my working life, at that time - Over 30 years in Commercial credit and lending and Canadian business financing. I believe the commercial lending landscape has drastically changed in Canada. I believe a void exists for business owners and finance managers for companies, large and small who want service, creativity, and alternatives.

Every day we strive to consistently deliver business financing that you feel meets the needs of your business. If you believe as we do that financing solutions and alternatives exist for your firm we want to talk to you. Our purpose is simple: we want to deliver the best business finance solutions for your company.



Showing posts with label buy competitor. Show all posts
Showing posts with label buy competitor. Show all posts

Thursday, July 26, 2012

Can You Buy Your Competitor Via An Asset Based Lender ? Unique Acquisition Strategies!





Here’s A Great Asset Based Lending Strategy To Finance An Acquisition !

Information on how you can use an asset based lender to buy a competitor via a acquisition finance strategy .. that works!




Ever had the idea to buy a competitor? Even more so have you wondered how this acquisition could possibly be done? One method is to use the service of an asset based lender to complete such a deal.

Even more interesting ... we couldn’t help but catch an article in one of the two leading business dailies in Canada... it said... (To us it screamed!) ‘BUY A COMPANY FOR NO MONEY DOWN! ‘... and this was from one of Canada's leading investment advisors!

The concept here was simply all about ' assets ' and a formula derived from Ben Graham, who is acknowledged as being one of the most prudent and smartest investors ever. (Buffett is a student of Graham... so something there must be working!

The actual formula Graham used to derive this strategy was to take all the current assets of a company, deduct all liabilities, and get a number he called ' net working capital '. If you know a bit about your competitors financial statements you will know this formula is not always going to work ... but if it did... well you have got the makings of a deal!

There is of course one key assumption here which is that all the assets are worth what they say they are worth on the balance sheet. Naturally there has to be some factoring of what they are really worth but that new number can be financed by your asset based lender, allowing you potentially to complete a transaction .

In essence what you have done here is used a finance strategy to finance the collateral in the company.

There are of course many reasons you might wish to acquire a competitor - they include revenue growth, economies of scale, market domination, etc. In many cases you might be aware of a motivated seller, perhaps a firm who is in financial difficulty or who wishes to execute some sort of exit strategy for the owners.

In most cases an asset based lender will have to consider paying out the current lender, which well might be a Canadian chartered bank. Other issues that need to be addressed are the potential profitability of the new firm going forward. Issues that can also help you move the transaction forward are your ability to normalize earnings and assess need for further assets. Also a vendor take back is a great strategy at this time.

Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you to by or acquire a competitor via an asset based lender acquisition strategy.



7 PARK AVENUE FINANCIAL

CANADIAN ASSET BASED LENDING AND ACQUISITION FINANCING EXPERTISE



Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/asset_based_lender_buy_competitor_acquisition.html