Partial buyouts not supported by SBA?

by a searcher

3 years ago

Does the SBA program not allow partial buyouts of businesses? Interested in buying out one partner, and the other one would like to stay on. Currently they are 50/50 owners. An SBA banker mentioned that the loan program only allows full equity purchase

2 likes
143 views
10 comments

lender from University of Missouri - Columbia

You can accomplish this but the owner staying on would need to guarantee the loan And have zero cash at close, probably unrealistic. Usually only works if the owner staying has less than 20% ownership.

3 years ago | like reply | 1 like

searcher from Georgetown University

Had a deal where the company had some minority share holders and the bank I was working with said the SBA would allow them to buy into the new company since they were less than 20%.

3 years ago | like reply | 1 like

More on Searchfunder

Just Closed on My First Deal! Reflections and Takeaways for other Searchers

45,152 transactions are available on Searchfunder (now searchable by keyword)

Now everyone has unlimited IBISWorld access

Family office looking for traditional searchers

Examples of self-funded searcher websites

Investor seeking Self-Funded Search Deals

What are market terms for Seller Notes?

2 Best Ways To Find Motivated Sellers, Off-Market Deals

Searchfunder is an online community and toolkit for searchfunds. Over 80% of those involved in searchfunds maintain a Searchfunder.com account to help them network, problem solve challenges, and keep up with the industry.

We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.