Unique expertise within reach B USINESS ACQUISITION SOCCA leads the - - PowerPoint PPT Presentation

Unique expertise within reach

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SOCCA leads the way and helps you make your business project happen

• Non-refundable contribution (ABDP grant)
• Term loan
• Coaching

BUSINESS ACQUISITION

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Our Clientele

• First Nations

– Abenaki – Algonquin – Atikamekw – Cree – Huron-Wendat – Malecite – Micmac

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Analysis process

Financial statements

• Is the business profitable?
• What’s the tendency during the last three years (sales, profits)?;
• Evaluating assets (detailed list of what is included in the sale);
• Quality of the financial statements;

Discussion with the seller

• Why is the seller selling?
• Is there a hidden problem?
• Is the industrie heading for a cliff?;
• Are the customers likely to slip away to competitors?

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Analysis process

Products and services

• History of the business activities (integration of new products and

services) ?

• What works well and what needs to be improved?

Market and competition

• Exclusive agreement with active suppliers/buyers?
• New competitors?

Industry

• What’s the tendency (decline, new regulations)?

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Analysis process

Management

• Stability of important managers
• Can the seller be easily replaced?

Operations

• Key employees ?
• Know-how transfer

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Studies prior to acquisition

Professional appraiser

• The appraiser will determine the value of the business’s assets

(inventory, land, building, equipment)

• Permits financial institutions to determine the maximum loan amount

depending of the assets value (collaterals) Chartered business valuator (CBV)

• The CBV will determine the fair market value
• Goodwill may be considered as an eligible cost of the business

acquisition, when it is supported by the business valuation.

• The ABDP will only consider the project eligible when the agreed

purchase price is within the range specified in the business valuation.

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Studies prior to acquisition

Environmental assessment (if necessary)

• Phase 1 study
• Phase 2 study

Business plan

• Why is it requested?
• Financial forecast (3 years)

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Our Products and Services (non-refundable contribution)

For the completion of the following activities:

• Start-up, acquisition or expansion of a business
• Implementation of marketing activities
• Business support (coaching, accounting, etc.)
• Development of a business plan and feasibility studies

(assessments, environmental studies, etc.)

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Our Products and Services (non-refundable contribution)

Eligibility criteria

• Be

– A First Nation – A member of a First Nation – A corporation owned by a First Nation or by one of their members

• Have the necessary financial resources (equity: 10% minimum of the cost of

the project)

• Present a viable business project
• Have experience and training in the field of activities
• Mandatory full-time involvement in the business
• Operate a business not involved in the following sectors of activity

(gambling, sex, alcohol, tobacco)

• Have a good credit rating (see example)

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Our products and services (non-refundable contribution)

Maximum contribution

• For a private project, up to $99,999
• For a community project (band council), up to $1 million

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Our products and services (non-refundable contribution)

Contribution level

Project cost Contribution rate Development of a business plan, marketing plan or feasibilities studies Up to 75% Start-up, acquisition or expansion of a business Up to 40% Implementation of marketing activities Up to 60% Project-related management Up to 75% Professional advisory services after the business is launched (accountant or other) Up to 75%

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Our products and services (term loan)

To achieve the following activities:

• Start-up
• Acquisition
• Expansion

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Our products and services (term loan)

Characteristics

• The amount of the loan is determined by the borrower’s repayment

capacity

• The value of guarantees offered must be sufficient to reasonably cover

the amount borrowed For example: Building and land Up to 70% Equipment Up to 70% Inventory Up to 50% Working capital 0 %

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Our products and services (term loan)

Equity required

• Minimum 10% of the total cost of the project
• The transfer of assets may be considered as equity

Interest rates

• Competitive and comparable to other traditional financial institutions
• Based on the risk associated with the project

Duration

• Based on the lifespan of the asset
• Up to 25 years

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Different financing possibilities

Non-refundable contribution programs

• Aboriginal business development program (ABDP)
• Secrétariat aux affaires autochtones (SAA)

Loans

• Aboriginal financial institutions (AFIs)
• Any other traditional financial institutions

Personal equity

• Minimum 10% of the total project cost

Sale price balance from the seller

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To apply for financing you must provide us with the following:

• Application for financing
• Personal balance sheet
• Applicant’s declaration
• Résumé
• Proof of Aboriginal ancestry (copy of the Indian Status card)
• Business plan (if already prepared)

For an existing business

• Financial statements for the last three years
• Recent interim financial statements
• Governing documents of the business
• Ownership agreement (where applicable)

IMPORTANT: No expenses incurred prior to approval of your file will be considered eligible in the calculation of the non-refundable contribution.

Our products and services

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• Head Office

2936, rue de la Faune, Suite 200 Wendake (Québec) G0A 4V0 Telephone: 418 842-0972 Toll free: 1 800 241-0972 Fax: 418 842-8925

Contact Us