Just looking at company’s balance sheet can be quite misleading – are there property assets that need revaluing? What about costs to realise or tax, unrecorded liabilities, and treatment of intellectual property?
Quite apart from this how should one treat the effect of liabilities included in the Net Asset position? Net bank debt/cash is relatively straightforward but the calculation of net cash/debt after working capital adjustments can be tricky.
In contrast “loan notes” issued to parties other than regular banks will often have non-standard terms. And the funder could have a different agenda – it may have been the former owner who has issued Vendor Loan Notes, or perhaps the Loan Notes arose as part of a management buyout.