Motivation: This project aims to explore business-cycle implications of the distribution of financial slack across firms. Instead of focusing on 'financial accelerator' upon an adverse negative shock, I focus on (i) the cross-section of firms' optimal financing strategies during recessions, (ii) how it affects the aggregate dynamics of acquisitions during recovery, and (iii) how the effect dynamically intensifies the size discrepancy between productive and unproductive firms – and hence, 'divergence.' A brief sketch of the core mechanism: lumpiness of capital reallocation – in the form of acquisitions – interacts with optimal financing strategy under bargaining frictions, and the pattern of this interaction is endogenously heterogeneous across firm productivity.