The Situation: CPA Firm Owner Seeks To Sell Business To Accountant

The owner of a successful CPA firm wished to retire and transition the business to an accomplished accountant with extensive experience. However, the owner had difficulty finding a traditional lender to finance a loan. First Business Bank’s SBA team worked with the seller and borrower to structure an SBA loan for the firm to accomplish the transaction.

  • Deal Complications
    Many banks had no capacity or resources during the COVID-19 pandemic to handle business acquisitions amid a sea of requests for disaster loans and working capital needs. An SBA Preferred Lending Partner, First Business Bank’s experienced SBA team worked to help structure this under-collateralized deal so it would be approved.
  • Lack of Tangible Collateral
    Traditionally, accounting practices and many professional services firms often lack large, tangible assets unless the business owner also owns the office building. The borrower’s solid business experience coupled with a solid business plan sufficed for the SBA 7(a) loan program in this case.

The Solution: 7(A) SBA Loan From First Business Bank

First Business Bank provided a 7(a) loan totaling $850,000, which included purchasing the business, purchasing equipment, intangibles, and providing working capital. Our borrower provided a down payment or injection money, which came from personal savings, retirement, and a gift from relatives.

  • Reliability
    First Business Bank’s underwriting and closing team communicated closely with the client to ensure a timely transfer of business and a satisfactory outcome.
  • Expertise
    First Business Bank’s expertise in SBA lending afforded us the opportunity to work with the SBA directly and helped us to structure an acceptable loan breakdown that satisfied all parties involved.
  • Functionality
    Given collateral requirements of traditional lending, the SBA 7(a) program was the right choice for the transition of this CPA firm to our borrower while providing working capital to ensure the continued success of the business.