2 min read
How a buy-out is funded
Finance can fund the purchase of a departing director's or shareholder's stake, structured through the company or the remaining owners. The lender checks the company can comfortably service the debt afterwards — its cover and cash flow.
What to weigh
Get the valuation and legal structure right, and confirm the ongoing business can afford the repayments. Note the rules if the company itself buys the shares, or a director's loan is involved. Take advice.
What it means for you
A well-structured buy-out can clear the way to grow. Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online.
Frequently asked questions
Can the company fund the buy-out itself?
Sometimes, through a share buy-back or borrowing, subject to legal and tax rules. The structure matters, so take professional advice before committing.
How do lenders view a buy-out?
They focus on whether the company can service the debt from its cash flow after the change. A cleaner, more decisive ownership can be a positive if the numbers support it.
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