Venture capital organisation

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Clariton Antiques Ltd have just been approached by'We Finance Limited', a venture capital organisation, with an offer to finance their expansion by offering the full 0.5m for a 20% stake in the business. Alternatively they can use the services of a finance broker to obtain a bank loan. The broker will charge a 1% fee on the amount secured and interest on the loan would be 2% APR payable over 10 years.

1. Give an assessment of the information that will be needed to make decision on financing the takeover by;

a) The Partners

b) Venture capitalist [We Finance Limited)

c) Finance broker

2. Explain the impact on the financial statements if Clariton Antiques Ltd choose to go with;

a) Venture capitalist [We Finance Limited]

b) Finance broker

Reference no: EM131459622

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