Structured SBA 7(a) financing drives strategic growth for automotive dealership
Introduction
Strategic SBA 7(a) financing drives business acquisition and operational growth. A comprehensive $4,571,000 SBA 7(a) financing package was expertly arranged to support strategic business acquisition and growth initiatives for an established automotive dealership. This specialized financial solution enabled the dealership to acquire essential business assets, bolster inventory, enhance operational liquidity, and position itself strategically within a highly competitive market.
Tailored specifically to the automotive sector, this financing addressed the dealership’s unique acquisition and operational capital requirements, ensuring immediate scalability and long-term business sustainability.
Challenge
Complex capital requirements and SBA compliance hurdles required a fully customized solution. The dealership faced multifaceted financial challenges that required significant capital and SBA expertise:
- Completing a critical business asset acquisition tied to market expansion.
- Securing funds to replenish and upgrade inventory in a competitive environment.
- Ensuring liquidity to support operating costs during the ownership transition.
- Designing a structure compliant with SBA regulations around asset classification.
- Navigating collateral requirements to meet lender expectations and SBA standards.
Solution
Custom SBA-compliant structure enabled acquisition, liquidity, and long-term efficiency.
- Business Asset Acquisition Financing ($2,760,328): Compliant structure for SBA-eligible assets, enabling immediate ownership transfer and operational scale.
- Real Estate Acquisition Financing ($1,000,000): Funded strategic property acquisition for long-term geographic and operational growth.
- Inventory Financing ($640,000): Delivered working capital to replenish vehicle inventory and boost responsiveness to demand.
- Working Capital & Closing Costs ($44,613): Provided liquidity for operating expenses and transaction execution.
- SBA Guaranty Fee Financing ($126,059): Rolled into the loan package to preserve upfront liquidity.
Key structural elements included:
- Required equity injection of $1,699,672 to meet SBA guidelines and strengthen borrower alignment.
- Prime-rate indexed interest with quarterly adjustments for optimized flexibility and affordability.
- Collateral package secured by real estate, inventory, and select business assets to meet lender and SBA thresholds.
Results
Customized SBA 7(a) financing enabled long-term growth and operational excellence.
- Strategic Acquisition Completed: Enabled the purchase of key business assets, positioning the dealership for expansion and long-term market competitiveness.
- Inventory Replenishment: Funded new vehicle inventory to meet immediate customer demand and enhance dealership turnover ratios.
- Liquidity Optimization: Improved operating capital enabled agility and consistent cash flow during the transition.
- Financial Stability: Predictable monthly payments on a 13-year term with no prepayment penalties allowed the borrower to manage costs effectively and accelerate repayment.
This structured SBA solution was instrumental in creating a durable capital foundation for the dealership’s continued growth and industry leadership.
About Cornovus Capital
With over 60 years of combined experience, Cornovus Capital is a trusted financial partner specializing in business financing, commercial real estate lending, and hospitality funding solutions. We design customized capital strategies that help businesses acquire, expand, and optimize operations, ensuring long-term growth and financial stability.
Our expertise spans SBA 7(a) and 504 loans, CMBS and LifeCo financing, private capital solutions, and structured debt strategies. By focusing on certainty of execution and closing assurance, we guide businesses and investors through complex financial landscapes, securing funding tailored to their long-term objectives.
Why Partner with Cornovus Capital?
At Cornovus Capital, we understand that complex transactions require sophisticated financing solutions. Whether you’re acquiring a business, buying out a partner, expanding operations, or combining real estate into a growth plan—we deliver capital strategies designed for certainty and efficiency.
What Sets Us Apart?
• Advisory expertise across business stages and sectors: We structure financing for acquisitions, expansions, partner buyouts, and practice ownership transitions.
• Innovative capital structuring: We integrate seller notes, working capital, CapEx, and goodwill financing into efficient, customized capital stacks.
• Lender alignment and competitive terms: We match each transaction with lenders who understand your industry—ensuring smooth approvals and favorable terms.
• End-to-end execution and advisory support: From deal modeling and loan packaging to lender communication and closing, we manage the entire process to ensure successful outcomes.
For business owners, professionals, and entrepreneurs seeking flexible SBA financing, Cornovus Capital delivers strategic insight, execution certainty, and long-term support.
Contact Cornovus Capital
At Cornovus Capital, we simplify the financing process with tailored solutions, competitive loan terms, and expert advice. Whether you’re acquiring, refinancing, or developing a property, we’re here to help you succeed.
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📞 513-653-4246
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