Funding Company Mergers and Acquisition
If the funding company you are considering was purchased by a bank in the past few years or months or is about to be purchased, look a bit closer. Occasionally a bank will buy a funding company, and in that case there is a
high probability that the purchased company’s legal documents and funding agreements (presented to new prospects) will get tougher. And you can be fairly sure management philosophy will change.
It is extremely rare for independent payroll funding organizations to buy funding divisions from banks. If a bank does sell off their funding company–to a conglomerate or a billionaire – the new group usually keeps the old bank-style documents. They’ve just spent a fortune purchasing a funding company – they don’t want to turn around and weaken their documents, which increases their risk on their brand new investment.