Structure is where risk gets allocated. Two deals at the same headline price can distribute the downside so differently that only one of them is worth doing.
Start a private conversation with the Acquisition Concierge, already scoped to deal structure & financing. Choose the question closest to yours, or describe your situation directly.
Buyers negotiate hardest over price, and price is usually the least interesting term. What determines whether an acquisition is survivable is the structure: whether you bought assets or equity and what liabilities came with that choice, how much of the consideration is paid at closing against how much is deferred or contingent, what the debt costs and what its covenants require, and what the purchase agreement says happens when something you were told turns out to be untrue. This stage covers those mechanisms, what each does, what it costs, and which risk it is actually addressing. All of it is territory where you need your own transaction counsel and your own tax adviser; the Institute's role is to make you a well-informed client of both.
Three areas that interact constantly, the structure determines what can be financed, and the financing constrains what can be structured.
The capital stack for a private-company purchase, senior debt, seller paper, private credit, and what each demands.
investigateContingent consideration, what it is genuinely good at, why it produces disputes, and how the mechanics decide that.
investigateWhat an LOI actually commits you to, what exclusivity costs, and why more is settled here than buyers expect.
investigateHow the Institute helps at this stage. It does not give legal or tax advice, draft documents, or arrange or provide financing.
It is genuinely fact-specific and one of the first things to put to your counsel and tax adviser, because the answer turns on entity type, jurisdiction, the liabilities involved and the tax position of both parties. The general tension is well known: buyers commonly prefer asset purchases because liabilities can be left behind and the basis position is often more favorable, while sellers commonly prefer equity sales for their own tax reasons and for a clean exit. What matters practically is that this is usually a negotiated trade rather than a free choice, a seller may accept an asset structure at a higher price, and the difference between the two positions is frequently bridgeable in money.
Less than sellers expect and more than buyers would like. Beyond the cash funded at closing from your equity and senior debt, it is common for part of the consideration to be deferred, a seller note, an earnout, an escrow held against indemnity claims, and a working-capital settlement that adjusts the figure after the fact. The proportions vary enormously with the business and the market. What matters is that both parties understand early what the seller actually receives on the day, because a seller who has been thinking about the headline number can become difficult very late in a process.
Cash flow first: whether the combined business services the debt with margin under a downside case, not at plan. Then the quality of the earnings supporting it, which is why lenders frequently want to see a quality-of-earnings report; the collateral available; your own equity contribution, since lenders want the buyer meaningfully exposed; and your credibility as an operator of this specific business. Expect covenants, leverage and coverage ratios tested quarterly, and read them as carefully as the rate, because a covenant breach in a soft year is a far more common problem than the interest cost.
Before the letter of intent is signed, which is earlier than many buyers assume. LOIs are largely non-binding on the commercial terms but usually binding on exclusivity, confidentiality and expenses, and, more importantly, the commercial terms recorded in them are very difficult to reopen later without appearing to renegotiate in bad faith. Retaining transaction counsel with genuine experience at your deal size before the LOI is signed is one of the highest-return decisions in the whole process.
Describe the transaction. The Concierge will orient you on the mechanisms and the deal team it calls for.