Business funding
Business Acquisition & Partner Buyouts
Capital to buy a business, buy into one, or buy out a partner.
General qualification guideline; lender and program requirements may vary.
Best forBuying into a business, buying out a partner, or funding an equity stake in a deal.
Overview
Financing an ownership stake, underwritten on the business you are buying
Acquisition financing funds the purchase of an ownership stake: buying an existing business outright, buying into one, or buying out a partner. Lenders focus on the target business’s cash flow and its ability to carry the new debt, along with the buyer’s experience and the money the buyer brings to the deal. SBA 7(a) loans are one of the most common tools for acquisitions, alongside conventional bank loans, seller financing, and private capital, and many deals combine more than one.
Benefits
- —Buy an established business with existing cash flow
- —Buy out a partner without draining working capital
- —Can be combined with seller financing
- —SBA and conventional structures available
- —Repaid from the acquired business’s cash flow
Good for
Situations where it tends to fit
Structures, down payment, and terms depend on the lender and program.
Documentation
What you will typically need
Documentation covers the business being acquired and the buyer:
- —Letter of intent or purchase agreement
- —Business tax returns and financial statements for the business being bought, typically three years
- —Year-to-date profit and loss and balance sheet
- —Buyer’s resume and personal financial statement
- —Personal tax returns
- —Government-issued ID
Qualification factors
What generally matters
- —Cash flow of the business being acquired
- —Buyer’s industry and management experience
- —Down payment or equity injection
- —Purchase price and valuation
- —Personal credit profile
- —Collateral available
Common questions
Acquisition financing, answered plainly
How much do I need to bring to the deal?
Most acquisition lenders expect the buyer to put in some of their own money. The amount depends on the program, the business, and whether the seller carries part of the price. We will look at your deal and tell you what is realistic.
Can the seller finance part of the purchase?
Often, yes. A seller note for part of the price is common and can reduce the cash you need at closing. Lenders set rules on how seller financing is structured, so it is worth planning early.
Can I use this to buy out my partner?
Yes. Partner buyouts are one of the most common uses. The lender looks at whether the business can support the new debt after the buyout and at the remaining owner’s ability to run it.
Buying a business or a partner’s stake?
Send us the business, the price, and the structure you have in mind. We will tell you what fits and what it takes.
The guidelines on this page are general guidelines only — not guaranteed lender approval requirements. Requirements vary by lender and program. TK Capital Solutions is not a lender; all funding is subject to lender underwriting and approval.