Businesses can fund mergers and acquisitions (M&A) using various financial instruments. Some companies use their own cash, while others need external financing. Here are the two primary options:

Equity Financing:

  • Businesses issue new shares or sell company stock to raise capital.
  • Companies may also do a “stock swap,” exchanging shares of the acquiring company for ownership in the target company.

Debt Financing:

  • Businesses get loans from banks, the Small Business Administration (SBA), or alternative lenders like Avery James Commercial Lending.

Sometimes, companies combine these two methods. Each has its pros and cons:

  • Bank Loan: Provides necessary cash, but requires a steady income and growing EBITDA. You’ll also pay interest rates on the loan.
  • Equity Financing: No debt incurred, but it reduces company ownership.

For financing without losing equity or waiting for a bank loan, consider an alternative lender like Avery James Commercial Lending.

How Does M&A Financing from an Alternative Lender Work?

Companies often use mergers and acquisitions to grow or stay competitive. Nontraditional financing provides capital quickly and efficiently. Porter Capital uses short-term assets as a down payment for business acquisition financing. Here’s the process:

  1. Identify your target business.
  2. Consult an alternative lender before issuing a letter of intent. This helps you understand how many of your short-term assets can be used.
  3. Approach the target business for negotiations and reach preliminary terms.
  4. After finalizing the preliminary deal, consult your lender again to receive the appropriate loan.

Why Trust Avery James Commercial Lending for M&A Financing?

Avery James Commercial Lending has offered commercial financial services nationwide for over 30 years, providing billions in working capital solutions. We leverage short-term assets like:

  • Accounts receivables
  • Company property
  • Intellectual property
  • Inventory

Alternative lenders like Avery James Commercial Lending help avoid the strict prerequisites of traditional bank loans and prevent diluting your ownership. You can receive funding in as little as 24 hours.