Catering company purchase

June 21, 2024

by a searcher from Texas Tech University in Austin, TX, USA

Curious thoughts on this potential deal. I have not signed BDA so I only know below.

Catering Company
Owner retiring
founded 1976.
26 employees.
asking $3MM
revenue $1.5MM
real estate $$1.6MM custom (kitchen/tasting room)
FF&E $165k
cash flow $650k

My main concern is how to deal w the real estate in the deal and take tax advantages. Clearly they got to the $3MM via this. I would SBA loan.
Thank you

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Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA

Hard to know much without seeing the actual financial statements, but if the real estate is over 50% of the purchase price, you could use an SBA 7A loan to finance both combined and secure a 25-year term against the full loan amount. This is going to greatly lower your required monthly payment versus financing each separately. Assuming 10% down, at that EBITDA level you would have more than enough cash flow to support an SBA 7A loan. If you get more information or would like to discuss financing options in more detail, you can reach me here or directly at redacted

Reply by a professional
from University of Massachusetts Amherst in Boston, MA, USA

Hi Scott, we help ETA entrepreneurs secure funding for their searches. We can potentially help you out with funding. Could you fill up this form: https://form.jotform.com/ridethewave/funding-ally, and please text###-###-#### or email redacted and I can see if we can help you out.

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