Phone: 516 - 551 - 5285 / 631 - 338 - 2438 Facsimile: 631 - 206- 9165   The first question that must be answered prior to obtaining funds from another party is: Why do you need the money? There are many reasons why companies seek outside financing. This section covers the most common reasons. Growth Financing   The most common use of financing is to fund a company's growth. Many companies reach a point in their growth at which they need outside financing to expand so as to meet their potential. read more   Physical Expansion   Physical expansion can be the easiest form of growth for a company to finance through outside sources. The company is normally increasing its asset base and therefore its borrowing capacity. Expansion scenarios can be located on a spectrum. At one end of the spectrum is the project in which all of the costs are associated with the purchase of fixed assets. read more   Working Capital for Growth   In some situations, a company can grow without purchasing additional assets or expanding its physical plant. Often this growth requires additional working capital to finance inventory purchases and accounts receivable that may grow faster than payables, thus putting the company in a tight cash position. read more   Refinancing to Replace Restrictive Lenders   There are situations when a company is poised for growth and is held back by a reluctant financial partner, most often but not exclusively a conservative bank unwilling to bear the risks of growth. Banks are often in the position of curbing growth if only because they generally do not price their loans to account for the risks associated with change. read more   Acquisition Financing   The opportunity to complete a strategic acquisition is one of the best ways to enhance the value of a company, since an acquisition may enable you to leap frog competitors, open new markets, develop new product lines, etc. However, a poorly executed acquisition can weaken a company's balance sheet and distract key management without providing the anticipated value. read more   Debt Financing   Debt is the cheapest method of financing an acquisition bid and can take many forms. The amount of debt that can finance an acquisition depends on the projected cash flows of the combined company. This will depend on the financial health of both the target and the acquirer. read more   Equity Financing   Equity is a more expensive form of capital than debt. This is because it carries the most risk since it has no claim to the company's assets. Acquisitions that have unstable cash flows require capital for growth and compete in turbulent industries often require a greater amount of equity. Equity provides more financial flexibility because it does not require scheduled payments. read more   Stock Swaps   It is also possible to use the acquirer's stock to purchase all or some of the shares of the target. This is very common among companies whose stock is publicly traded. A stock swap is more difficult in private transactions because the acquiring stock is illiquid (i.e., cannot be quickly sold). However, if the owner of the target would like to retain some stake in the combined company, then exchanging shares is a sensible solution. read more   Turnarounds   Turnaround financing involves providing capital to companies that are performing poorly but that are expected to turn around and perform much better in the future. Often this kind of financing occurs in the context of a transaction or purchase of the company by a new owner and often a new management team is hired at the same time. Turnaround financing can include senior debt, subordinated debt and equity. read more   Management Buyouts   Managers often team up with private equity investors to purchase businesses or subsidiaries, divisions or product lines of corporations, using a combination of debt and equity financing. This is one of the most powerful methods for enriching the entrepreneurial spirit of professional managers. read more   Employee Buyouts   Employee buyouts are one of the most fascinating developments in the world of corporate finance. They had their beginnings in the early 1970s after Employee Stock Ownership Plan (ESOP) regulations were codified in the law as part of the ERISA legislation in 1974. An employee buyout involves owners of a company selling a majority of their stock to its employees through an ESOP structured corporate transaction. read more   ESOP Financing   Countless studies have shown that employee ownership motivates employees to improve their productivity, the quality of their work and the competitiveness of their company. ESOP financing provides a whole series of benefits to the owners of a company, to the company itself and to the employees. read more   Internet Financing   Every company that deploys a product or service through a large and expensive distribution system will be confronted over the next ten years with a major distribution dilemma. Should the company continue to market through its existing distribution system or should it dramatically reduce costs by turning instead to the Internet to distribute and market its product or service? read more   Recapitalizations   There are many situations in which a company may need to be recapitalized. As the word implies, a recapitalization involves an infusion of capital and, potentially, certain parties taking money out of the company. read more   Rollups   A rollup is a strategy of buying several companies at once, or in rapid succession, in one industry to gain a variety of corporate benefits, such as economies of scale, broader product line, cheaper financing, greater diversity of customer base, etc. read more     Home | About Us | Going Public | Contact | Privacy Policy | Terms of Use | Site Map Designed by: Ingenux | Copyright 2006 ©GrandViewConsultants