Experience with banks in Canada as an international student

searcher profile

April 28, 2021

by a searcher from University of Pennsylvania - The Wharton School in Toronto, ON, Canada

Hi, I'd like to know about the experience of searchers (Traditional/self funded) who have dealt with banks for lending terms for their LBO.

What was your experience?

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commentor profile
Reply by a searcher
from Ivey Business School at Western University in Toronto, ON, Canada
Pretty dependent on the size and characteristics of the deal. The 6 bigger banks have surprisingly volatile views on microcap LBOs depending upon industry, etc. Not much by way of private debt funds (although Private Debt Partners just came out with a fund covering the space) here that like to do small deals, and outside of BDC/EDC not much of a SBIA-like program that the US has.

Only thing to be careful of is to make sure that the term sheet has been shown to the bank's credit committee and received a verbal or anecdotal approval before you sign, as there have been some re-trade issues in the past. Should expect to receive 1.5x-3x ebitda for a deal thats $1.5-3M in ebitda, at reasonable (5% or less) rates on a 5-7 year AM schedule, with no personal guarantee. If you're not getting that from anywhere, its possible its not as nice a business as you think :)
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Reply by a searcher
from Queens University in Edmonton, AB, Canada
In my experience the bank currently handling the company's banking/lending is the best place to start. Recently went through the process for a transaction, spoke to a couple of the big 5 as well as the existing senior lender (who isn't super aggressive in transition lending), and the existing senior lender was by far the most aggressive and most responsive.
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