Business-acquisition financing in Canada

How the structure works

A transaction may combine buyer equity, senior debt, seller financing or other capital.

The label does not establish the amount, rate, security, personal guarantee, fees or decision time available to a particular business. Obtain the actual agreement and disclosure from the applicable provider.

Tradeoffs to consider

• Valuation, due diligence and post-closing cash flow matter.
• Different capital layers may have different priority and covenants.

Questions to ask before accepting

• What equity and seller contribution are required?
• How will the acquired business support the financing?

Documents to prepare for a provider discussion

• Business financial statements and cash-flow forecast
• Recent business bank statements
• Business identity and ownership information
• Details of existing obligations
• Purchase agreement, target financials and due-diligence records

Compare the cash-flow commitment

Write down net proceeds, the complete payment schedule, upfront and ongoing fees, conditions for changes, and the cost of early repayment. Test whether the business can meet the obligation when receipts are delayed.

Sources and editorial scope

• BDC: acquisition financing

  Verified 2026-09-30 · CA · Primary source

Sources support product mechanics. CBL’s tradeoffs and preparation questions are educational synthesis; they do not represent any provider’s underwriting policy. Editorial policy