I'm planning to sell my business — should I take on finance first?

Before a sale, borrow only to lift value or fix a genuine bottleneck — not to prop up cash; a buyer prices in debt, so finance must earn its place in the deal. A buyer looks at both the earnings and the balance sheet. Debt taken on shortly before a sale is scrutinised — it needs to have clearly added value, not masked a problem.

I'm planning to sell my business — should I

2 min read

Value-adding onlyNot to prop up

Buyer prices debtInto the deal

Clean handoverOr repay on sale

The pre-sale question

A buyer looks at both the earnings and the balance sheet. Debt taken on shortly before a sale is scrutinised — it needs to have clearly added value, not masked a problem.

When finance still makes sense

Borrowing to complete a value-adding project — new capacity, a profitable contract — can lift the price by more than the debt. A business loan that raises earnings usually pays for itself in the sale multiple.

What happens to the loan on sale

Because Credicorp lends to the company, the borrowing can be settled from the sale proceeds or, subject to terms, transfer with the business. See what happens to a loan if I sell my business.

What it means for you

Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online when the numbers work.

Frequently asked questions

Will taking a loan before selling reduce the sale price?

Only if it doesn't add value. Debt that funded genuine, earnings-lifting improvement usually raises the price by more than the loan; borrowing to plug a hole tends to worry buyers.

Can a business loan be repaid from sale proceeds?

Yes. A company loan can typically be settled from the proceeds at completion, or transfer with the business subject to the terms and the buyer's agreement.