Selling a company is one of the most important decisions an owner will ever make. Even if you’re not in the middle of a transaction, many of you know business owners, executives, and families who are thinking about “what’s next.”
As we look toward 2026, the environment is shaping up to be unusually favorable for sellers. Lower interest rates and record levels of private equity capital are creating conditions where well-run businesses may have more options – and more negotiating power – than they’ve had in several years.
We thought you might appreciate a brief snapshot of what we’re seeing in the market.
Why 2026 Is Poised to Be a Strong Year for Sellers
Lower interest rates lift valuations.
When borrowing costs fall, buyers can pay more. We’ve seen this repeatedly. A few years ago, one buyer reworked its entire financing structure simply because cheaper debt allowed them to increase their bid for our manufacturing client. When capital gets cheaper, valuations move.
Private Equity needs to deploy capital – and soon.
In conversations with 10-20 PE firms each week, the message is the same: funds raised in 2021-2024 still have meaningful “dry powder.”
Their investors want that capital put to work. That urgency translates directly into competition, stronger terms, and faster decisions.
Strong demand across the lower middle market.
Buyers remain active across several sectors, including:
- Distribution & Specialty Manufacturing
- IT Services & Cybersecurity
- Third-Party Logistics (3PL) & Asset-Light Freight
- Professional, Technical & Residential Services
- Healthcare & Pet Products & Services
- Branded & Specialty Food Manufacturing
Well-run, profitable companies entering a structured process are drawing immediate interest from strategic buyers and private equity alike.
A Strong Market Still Requires Care
Even in a favorable environment, M&A is rarely “simple.” Owners and boards still have to navigate some familiar challenges:
- “Win the deal now, renegotiate later” is still a tactic. Some buyers will aggressively overbid to secure exclusivity – then try to revisit price during diligence. Running a truly competitive process with multiple qualified buyers creates accountability and reduces the risk of a broken deal.
- Diligence is deeper and slower. Quality of earnings reviews, environmental work, lender approvals, and third-party diligence providers all add time and complexity. When companies prepare materials before going to market, the process tends to be faster, cleaner, and far less stressful for management teams.
- Not all buyers have readily available capital. Some buyers arrive with capital already secured; others still need to raise financing. The “highest price” on paper is not always the best outcome. Comparing multiple complete offers before signing an LOI helps identify the right combination of price, terms, and certainty to close.
How We Think About Our Role
For nearly three decades, our focus at Aethlon has been helping business owners navigate these dynamics thoughtfully and confidentially – from preparing for a sale to selecting the right buyer and negotiating terms that align with their goals.
Whether you’re simply curious about what’s happening in the market or know an owner who’s starting to think about a transition, we’re always happy to be a resource.
To schedule a conversation, please Contact Us.
