BY GARY GUION

Debt Transaction Considerations for

Businesses

Debt Transaction Considerations for Businesses

An experienced real estate finance professional, Gary Guion delivers sound, expert advice on debt and investment transactions that maximize asset value. Gary Guion currently serves on the Real Estate Advisory Board at the McCombs School of Business at the University of Texas at Austin.

Debt Transaction Considerations for Businesses

Businesses often pursue additional funding to take advantage of growth opportunities. Careful deliberation about long-term corporate goals and immediate cash flow expectations allows principals to develop an optimal strategy to achieve successful debt financing. In addition, principals promote an ideal debt transaction by predetermining factors such as their own appetite for risk, lender oversight, and debt service schedules.

Debt Transaction Considerations for Businesses

The search for the right lender requires business owners and C-level executives to create cohesive, comprehensive documentation about their company’s revenues, customers, debt, assets, and business model. These tools offer potential lenders the opportunity to learn about the organization and assure them that it has accomplished financial readiness to undertake a debt transaction. Many businesses retain the services of a professional with experience in the negotiation and structure of debt transactions; such counsel provides valuable insight into possible obstacles as well as tactics to overcome or resolve them. Issues that arise during debt transactions include lender concerns about existing contracts, attrition of key personnel, and the company’s cost of operations.