Has anyone acquired a small business via stock or LLC purchase?

September 30, 2025

by a searcher from Columbia University - Columbia Business School in Princeton, NJ, USA

Investors or operators usually acquire via asset purchase, but have anyone acquired 100% of the seller’s LLC or stock so they can add debt into the business instead of forming a new LLC to acquire and needing to wait 3 years in existence to add debt? I’m talking specifically $100k to $250k total purchase price businesses that do cash flow.

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Reply by a searcher
from Purdue University in Bellevue, WA, USA

I acquired our last one via stock purchase (100%) for that very reason but we did buy via another LLC so our personal names were not attached to it. If the business is not heavy in debt, legal issues, or other risk and liability I prefer stock, especially if they are a C-corp. Maybe one day I will just do assets, but the intangibles are worth a lot for really established and well known companies with good reputations.

Reply by a professional
from The Johns Hopkins University in Basking Ridge, NJ 07920, USA

As noted above, there are reasons for both, but stock sales are generally less preferred by buyers. There may be compelling reasons to purchase stock (e.g., continuity of business, licensure/contract concerns) but each deal should be evaluated on its own. If taxes are the biggest concern, there are structures to treat stock sales as asset sales for tax purposes (f-reorg mentioned above, 336(e), 338(h)). Good luck!

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