Hi,
I am looking at buying a business through a share purchase. On the last balance sheet there was a shareholder loan (due to shareholders) of $120k. Let’s say I’d offer $1M, $880k for the shares and $120k for the shareholder loan. As this is based on the last set of financials, existing shareholder loan might be different in the balance sheet on closing day.
Now here’s my question: How would a change in shareholder loan on the books influence the overall purchase price? If the shareholder loan is only $80k on closing day, would that mean I’d also pay $40k less overall?
Thanks
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