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1Repair Windows errors before they cause bigger problems2Fix the driver behind crashes, sound loss and screen glitches3Clear out junk files and repair common Windows errorsThere is no universally best way to fund an acquisition. The right mix depends on the buyer’s strategy, balance-sheet strength, cost of capital, risk tolerance and expected returns—and on how much cash the combined business will need after closing. Compare each option by its full cost, repayment and control terms, execution certainty, and the liquidity it leaves for integration and day-to-day operations.
This guide is for owners and finance leaders of Irish businesses assessing an acquisition. Its financing discussion draws on Sandra O’Connell’s Irish Examiner special report of 2 October 2026, which was labelled an advertising feature. The named contributors’ views are useful decision prompts, not transaction-specific financial, tax or legal advice.
Start with the acquisition and the cash the business must retain
Before choosing a financing instrument, set out what the acquisition is meant to achieve, how much capital it requires and what the combined business needs to operate safely after closing. Purchase price is only one part of the funding need: integration, working capital and continued operations also require cash.
Stephen Kane, head of corporate advisory at Goodbody, put the strategic test this way: “Acquisitions should be an extension of strategy, not a substitute for one.” A funding structure should support the acquisition thesis without leaving the business unable to absorb weaker-than-expected performance or pursue essential investment.
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- Define the acquisition thesis and capital need. Identify the strategic objective and the funds required to complete the transaction.
- Test cash-flow capacity. Assess the target’s cash flows and the combined business’s ability to meet obligations under less favourable conditions.
- Set a post-close liquidity floor. Decide what must remain available for working capital, integration, resilience and planned investment.
- Compare complete funding terms. Include costs and fees, repayment timing, security, covenants and refinancing exposure—not just the headline amount.
- Assess control and future capacity. Consider how each option affects ownership, governance, borrowing capacity and the ability to fund future opportunities.
Compare the main funding routes
| Funding route | Potential advantage | Key trade-off |
|---|---|---|
| Balance-sheet cash | Can offer speed, certainty and ownership control without adding financing execution risk. | Uses liquidity that could support operations, resilience or another investment; consider the return forgone on the cash used. |
| Traditional bank debt | Preserves equity and may suit an established business with predictable cash flows. | Repayments and covenants can constrain flexibility; leverage increases exposure to downside as well as upside. |
| Alternative lending | The Irish Examiner feature says it may offer more flexible repayment structures than bank debt. | The feature describes it as more expensive than bank lending. Availability and terms are lender-specific; no offers or comparable pricing were supplied. |
| Buyer shares or share consideration | Can reduce cash paid at closing and give the seller a stake in the combined business’s future growth. | Existing shareholders share ownership. The economics depend on negotiated valuation and terms. |
| Private equity or other third-party equity | Adds capital without increasing leverage and may support a larger acquisition. | Dilutes ownership and can bring investor governance and involvement in strategic decisions. |
| Vendor financing | Reduces immediate funding needs; the feature says it may signal seller confidence. | Creates future payment obligations and leaves the buyer exposed to an ongoing financial relationship with the seller. |
| Earn-out | Can bridge a valuation gap, reduce upfront capital and tie some payment to future performance. | Poorly designed measures or terms can lead to disputes and misalignment over strategy after closing. |
| Invoice finance or asset-based funding | The feature says eligible receivables may support a facility as part of a wider package, potentially preserving liquidity. | Eligibility and facility terms are not established by the feature; a sales ledger does not automatically qualify or guarantee funding. |
| Blended funding | Combines sources to fit the transaction and longer-term business needs and may ease cash-flow pressure. | Requires coordination of repayment, control, covenants, timing and liquidity across the instruments. |
These trade-offs are qualitative, not a priced comparison. The Irish Examiner feature supplies no comparable rates, lender quotes, tax calculations or worked funding model. It describes interest deductibility as a potential tax advantage of debt, but the tax outcome depends on the transaction and should be checked with a qualified Irish tax adviser rather than assumed.
When cash may fit—and what it costs beyond the purchase price
Using cash can make a deal simpler and more certain to execute, while avoiding new financing obligations. But cash has an opportunity cost: money spent on the acquisition is no longer available for operating needs, resilience, integration or another investment. A cash-funded deal can therefore be unattractive even when the buyer has enough to pay the price if it leaves too little liquidity afterward.
Rank #2
Set the amount the business needs to retain before deciding how much cash to contribute. Then compare the expected return from deploying cash in the acquisition with the value of keeping it available for other business needs.
When debt may fit—and what to test
Debt can preserve existing ownership and may suit a buyer whose business can support predictable repayments. The central question is not only whether repayments work in the expected case, but whether the business can still meet them if the target’s cash flow disappoints or the combined company faces pressure.
Rank #3
- Review repayment timing against the combined business’s cash-flow profile.
- Understand the security, covenants and consequences of breaching them.
- Assess leverage and refinancing exposure, including how they could limit future borrowing or investment.
- Compare the complete cost and terms of bank and alternative lending; the feature’s general descriptions do not establish what a particular lender will offer.
When equity or seller-linked payments may fit
Equity from investors or the seller
Third-party equity can add capacity without increasing debt, but investors may receive ownership, governance rights and a role in strategic decisions. Share consideration can reduce the cash paid at closing and allow the seller to participate in future growth, but it also changes the ownership split. In either case, the value depends on negotiated terms; the feature provides no standard valuation or dilution figures.
Vendor financing and earn-outs
Vendor financing defers some funding need but leaves a payment obligation after completion and a continuing financial connection with the seller. An earn-out makes some payment conditional on agreed future performance and can help bridge a valuation gap. Its usefulness depends on clear, workable measures and terms: ambiguity can create disputes about results or post-close decisions.
Both structures require careful transaction-specific drafting. The feature does not establish standard terms, and neither should be treated as a substitute for assessing the buyer’s ability to fund the business after closing.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Why businesses may blend funding sources
A package can combine debt, equity, cash, seller-linked payments, invoice finance or asset-based lending rather than rely on one source. Ala Browne, sales lead at Bibby Financial Services, described this as an increasingly common approach in the Irish Examiner feature. A blended structure may preserve some liquidity or ownership while supplying more acquisition capital, but each instrument brings its own repayment, control and eligibility conditions. The feature gives no quantified example showing that one blend is superior.
Best Value
Invoice finance or asset-based funding should be assessed against the specific assets and facility terms. The feature says eligible receivables may support funding; it does not establish that every business’s receivables qualify or that a facility will be approved.
Use evidence carefully when sizing the market
The Irish Examiner advertising feature reported that 34% of Irish businesses planned to explore a merger or acquisition transaction in 2026, citing Bibby Financial Services’ SME Confidence Tracker. It also reported that a further 14% were considering a full sale. The indexed feature text does not state the tracker’s sample size or methodology, and the underlying tracker is not independently established here; treat these as figures reported by the feature, not independently verified market-wide estimates.
Get advice on the actual transaction
Corporate finance and debt advisory are relevant service categories when comparing transaction funding. KPMG Ireland describes corporate finance services for buyers, sellers, borrowers, lenders and financial investors, including M&A and debt advisory: KPMG Ireland Corporate Finance. Its fundraising page describes advice on debt, mezzanine and equity sources from assessment through execution: KPMG Ireland Fund raising for business. These service descriptions do not validate a particular financing recommendation or offer.
Have qualified Irish tax and legal advisers review the consequences of debt, security, share consideration, vendor finance and earn-out terms for the specific deal. Confirm any lender’s current eligibility, pricing, security, covenants, fees and repayment terms directly before relying on a facility.
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Source and context
The financing options and contributor comments in this article are drawn from Sandra O’Connell, “Choosing the right funding structure is as crucial as choosing the right target,” Irish Examiner special report / advertising feature, 2 October 2026: Irish Examiner feature. KPMG Ireland’s linked pages confirm the service categories they describe; they do not independently substantiate the feature’s general claims about funding trade-offs.
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