The “One Big Beautiful Bill Act” (OBBBA) presents a strategic window for buyers and sellers to act before the market fully prices in the changes. For sellers, the bill presents an opportunity to enhance valuation through improved cash flow, permanent tax relief, and industry-specific incentives.
For buyers, the OBBBA unlocks a broader pool of higher-performing targets. Still, concerns about the current administration’s trade policies, if realized, could negatively impact future interest rates, inflation, and sector volatility risks in the intermediate term.
How the OBBBA Could Reshape the Business Exit Market
Here’s a summary of the OBBBA changes and their likely impact on the exit market.
Stronger Multiples Boost Short-Term Market Value
Permanent tax cuts for pass-through entities and 199A deductions, also known as Qualified Business Income (QBI), will provide an ongoing boost to the bottom line for many businesses.
With higher earnings, these businesses may command higher EBITDA multiples and exit valuations, making them especially appealing to private equity firms, M&A firms, and strategic buyers.
Clear Sector Winners and Losers Emerge
Industries that benefit from the passage of the OBBBA include manufacturing, construction, defense, semiconductors, and traditional energy companies. These industries will benefit from expanded deductions, bonus depreciation, and increased spending.
Some ESGs, EV, wind, solar, and other clean-tech businesses, on the other hand, will face challenges as subsidies roll back, reducing their future revenues, profits, and exit allure. Buyers are expected to gravitate to the industries as mentioned earlier and move away from green businesses.
Rising Market Risks May Accelerate Exits
With deficits projected to increase by another $2.4 to $2.8 trillion over the next 10 years, interest rates and debt concerns could eventually cool overall valuation levels. For this reason, some experts argue sellers in growth-favored sectors may want to accelerate exits before macro pressures build and multiples compress in 2026 or 2027.
Understanding the Strategic Planning Imperative for Business Owners
Planning Proactively, Optimizing Valuations, and Recognizing Sector Realignments
My takeaways about the OBBBA and the implications for the exit market can be summarized in the following statements:
- All businesses should reevaluate their capital expenditures, expense structure, and buyer pipelines in light of the OBBBA’s incentives. Because the OBBBA reset the estate tax at $15 million (and adjusts that amount for inflation), this is also a big win for family-owned businesses.
- Owners of tax-advantaged businesses should leverage improved earnings to boost their business’s valuation in 2025. If your EBITDA increases by $200,000 due to tax savings and accelerated depreciation and your business sells at a 5x multiple, for example, that’s $1 million in added exit value.
- The OBBBA has triggered a surge in federal and state infrastructure funding and defense manufacturing incentives, favoring:
(i) construction & skilled trades
(ii) industrial & civil engineering
(iii) electrical & telecom contracting
(iv) manufacturing & defense supply chains - Clean-tech and other green-focused owners should reevaluate timing, possibly diversifying or pivoting before selling.
- Exiting owners should engage buyers when multiples are high and macro headwinds are low.
The OBBBA will likely reshape future exit transactions in the short term by boosting earnings and valuations, while also creating headwinds for green businesses; however, longer-term market uncertainty could persist. Strategically positioned owners can ride this wave, but others may need to rethink or expedite their exit plans.
Confidently Lead Through the Shifting Exit Market with IEPA
The OBBBA introduces material changes that affect business valuations, sector attractiveness, and exit timing. For advisors, this represents a strategic opportunity to guide clients through a complex and evolving landscape with clarity and foresight.
At the International Exit Planning Association (IEPA), we help advisors lead the charge. Our CBEC® certification and strategic methods that will help you.
- Capitalize on tax-driven valuation boosts
- Align exit timing with sector-specific tailwinds
- Guide clients through policy-triggered transition windows
- Protect value amid macro uncertainty
- Differentiate your practice as an “exit doer”
With the right insights, strategic timing, and preparation, current legislation can be utilized to support a more efficient and value-maximized business transition.
Be the advisor your clients need, before the window closes.
Join the IEPA community and start planning smarter exits today.
About the Author
James J. Talerico, Jr., CMC® CBEC® is an award-winning author, blogger, speaker, and a nationally recognized small to mid-sized (SMB) business expert, with outstanding business consulting, succession planning, value acceleration, and exit planning credentials. He is the owner of Greater Prairie Business Consulting, Inc. (www.greaterprairiebusinessconsulting.com) located in Irving, Texas, and has helped thousands of business owners throughout the U.S. and in Canada maximize their business performance and exits for more than 30 years. Jim currently sits on The IEPA’s Education Committee.