All Topics / Finance / Finance for private company shares

Viewing 7 posts - 1 through 7 (of 7 total)
  • Profile photo of FjwagonFjwagon
    Participant
    @fjwagon
    Join Date: 2007
    Post Count: 2

    Hi guys ,

    Chasing different approach on getting finance for private company shares .. To date I’ve been using traditional personal loans (unsecured) and negotiating rates with the bank . However last time around I wasn’t able to get a loan at a favourable rate.

    Regards mike

    CharlieX
    Participant
    @charliex
    Join Date: 2015
    Post Count: 98

    bit more elaboration would help to understand what you’re doing?

    do you mean trying to get money for you to buy shares in ASX or do you mean trying to get people to buy shares in your private company?

    Profile photo of FjwagonFjwagon
    Participant
    @fjwagon
    Join Date: 2007
    Post Count: 2

    Apologies for that.. Had my 11pm brain not working.

    I am talking about purchasing shares in a firm I work for that is non ASX listed. Isn’t a small backyard dodgy type deal this is a 10,000 employee global firm.

    Because it isn’t ASX listed the typical marginal type loans aren’t available . Also what I have found is that the banks won’t really take to account existing shareholdings or values/returns on the investment being a “private investment” I do have equity in my property I could use however not sure if this is the best approach or what other options I could have..

    Using a personal loan has had taxation advantages for me however given you rely on dividends to service the loan you have to be very diligent with your cashflow..

    Just wondering if anyone has had similar difficulties and if anyone has some creative ideas.

    Thanks CharlieX for the response

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,190

    No commercial lender will lend you substantial sums without security. Generally private company shares are not worth much in terms of security. You will need to provide land as security to get a decent amount.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    CharlieX
    Participant
    @charliex
    Join Date: 2015
    Post Count: 98

    Private company shares are difficult for lenders, they need trust and verification.

    so comes down to what TerryW said.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,190

    Lenders need security (in the legal sense) for their money.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of Corey BattCorey Batt
    Participant
    @cjaysa
    Join Date: 2012
    Post Count: 1,010

    You need to provide security to borrow funds. One way is to do an equity access against a property which has sufficient equity and then use those funds to make a purchase. Nice and simple – but requires you to have the funds available.

    Corey Batt | Precision Funding
    http://www.precisionfunding.com.au
    Email Me | Phone Me

    Investment Focused Finance Strategist - servicing Australia-wide

Viewing 7 posts - 1 through 7 (of 7 total)

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