Business Acquisition Financing
Owners price the business they built. Buyers price the business they can underwrite.
Buying a business is the largest cheque most owners ever write, and the financing dies on details nobody mentions until they kill the deal: a purchase structured as shares when the program only funds assets, a valuation built on potential when the lender prices trailing cash flow, an option period shorter than underwriting.
We structure and place acquisition financing: the equity, the seller note, and the guaranteed debt, assembled so the deal closes inside its timeline.
The Rule That Kills Deals
CSBFP funds asset purchases. Not share purchases.
The Canada Small Business Financing Program, the workhorse of small acquisition lending, finances tangible business assets and improvements. Share purchases are an ineligible use under the program rules, full stop. Most buyers learn this after the offer is signed, and the deal dies on a rule that was public the whole time.
Many share deals can be restructured as asset deals, and that restructuring is normal intermediary work. It also changes the tax outcome for both sides: sellers often prefer shares for capital gains treatment, buyers get better depreciation and cleaner liability from assets. The negotiation is real and it belongs at the start of the deal, with accounting and legal input, not at the financing stage when the option clock is running.
Structure first. Financing second. Run them in the other order and you pay for it in weeks or in the deal itself.
The Stack
Acquisitions are financed in layers.
Almost no one writes one cheque for the full price. A typical structure stacks three layers, and the art is in their proportions:
What lenders pay for is trailing, normalized cash flow: the earnings that survive the seller adding back their car lease. What buyers pay for is potential. The gap between those two numbers is the negotiation, and the stack is how it gets bridged.
Three Buyers, Three Files
Lenders read the buyer as hard as the business.
The employee buying the employer
Seven years running the place counts, if the file shows it. Lenders read tenure as de-risked transition: you know the customers, the staff, the slow months. What the file needs from the seller: clean financials, a transition period in writing, and often a piece of the financing.
The buyer with more plan than equity
High-leverage acquisitions get done, but the leverage has a structure: your equity, a seller note, and guaranteed term debt, stacked in that order. Anyone promising 100 percent financing is usually describing a seller carrying half the price. The stack is negotiated, not found.
The operator buying a competitor or a partner out
This is share-sale territory, where the guaranteed programs do not reach. The deal either restructures to assets, gets financed conventionally against your existing operation, or both. Which path wins is a tax and structure question before it is a financing question.
The System
First, we read your file the way lenders read it.
An acquisition file gets read twice: once for the business you are buying, once for you. The assessment runs both reads before any lender does. Every engagement starts with the same assessment: your financials and your ask, weighed against what each lender desk actually approves. It ends in one of two places, and both of them move you forward.
If the file is fundable
It goes to the right desk, and only the right desk.
We match your profile to the lenders whose approval patterns fit it. No blasting your file across forty inboxes, no surprise calls from lenders you never chose.
If it is not fundable yet
You get a plan that names what blocks you.
What stopped the file, what changes it, and how long that takes. Most declines are fixable; the plan is the work of fixing them, on a timeline you can hold us to.
Questions, answered
What buyers ask us.
Can I buy a business with no money down?
Rarely, and never the way the phrase suggests. So-called 100 percent financing almost always means the seller is carrying a large note, or the buyer is pledging other assets. Lenders want the buyer exposed to the downside. A realistic plan starts with the equity you do have and structures the seller note and term debt around it, rather than hunting for a unicorn.
Can a CSBFL loan fund the business I want to buy?
If the deal is an asset purchase, the eligible assets fit the program classes (real property, leasehold improvements, equipment, plus limited intangibles and working capital), and the business stays under $10 million in gross annual revenue: quite possibly. Share purchases are ineligible, period. Terms run to 15 years and the program caps term lending at $1 million per borrower, so larger deals stack conventional debt above it.
The seller wants more than the lender will finance. Now what?
This is the normal case, not the broken one. Owners price the business they built; lenders price the cash flow they can verify. The bridges: a seller note for the gap, an earn-out tied to performance, or a price correction. A deal that only works if the lender accepts the seller’s optimism is not financed; it is postponed.
Can I get a loan to buy the business I work for?
Often yes, and your tenure helps materially. Lenders read insider years as lower transition risk: the customers, the suppliers, and the staff already know you. What tenure does not replace is the file: you still need the financials, the normalized earnings, a transition agreement, and usually some seller participation. Time served strengthens a complete file. It does not excuse an incomplete one.
How fast can acquisition financing close?
Deal-dependent, and the honest framing is sequencing rather than speed: financing should start with diligence, not after it. Option periods in the 60 to 90 day range are workable when the file is assembled early; they get tight when the financing conversation starts in week four. The most expensive sentence in acquisitions is "we will sort out the financing once the offer is accepted."
What is PFG’s role and what does it cost?
We structure the stack, prepare the file (with PMG’s CPA team on the plan and projections, more than 1,200 prepared since 2010), and place it with the desks that do acquisition lending. You pay us, mostly when funding lands. Lenders pay us nothing. If the assessment says the deal cannot be financed as priced, you hear that before you spend more on it.
Program rules per ISED's published CSBFP guidelines as of June 2026. Tax treatment of asset versus share sales varies by situation; bring your accountant in early, ours included.
Bring us the deal before the structure sets.
One assessment reads the target's numbers, your file, and the stack that closes it. The earlier the read, the more of the deal that survives it.
You pay us, mostly when funding lands. Lenders pay us nothing.