The first Canada Investment Summit drew investors from nearly 30 countries and produced nearly CA$500 billion in new investment commitments, according to the federal government. The change that reaches lower middle market deals is a tax measure announced from the same stage. Source Of The Commitments - Banks And Pension Funds: Canada's largest banks account for nearly CA$325 billion in new financing. Pension funds and insurers add close to CA$100 billion. Most of these are announced lending capacities and multi‑year allocation targets. - Closer To The Lower Middle Market: CIBC committed CA$2 billion in financing for small and medium-sized defence and dual-use businesses. The federal government will deploy CA$700 million through BDC into the same sectors. The Productivity Mega Deduction - What It Does: Canada's tax rules normally spread the deduction for an asset's cost over several years. The proposal lets businesses deduct the full cost in the first year, permanently, for most assets acquired on or after September 15, 2026. About two-thirds of business capital spending would qualify, up from about 15 per cent under Budget 2025's Super-Deduction. - What Stays Out: Most buildings and goodwill do not qualify, along with a few other asset types. Finance estimates the marginal effective tax rate on new investment falls from 13% to 6.4%, against 16.9% in the US. The measure has been released as draft legislation and is not yet enacted. Where It Meets An Acquisition - Asset Purchase: In an asset deal, the buyer purchases the equipment itself. A third-party buyer can write off the equipment portion of the price in year one, even though the equipment is used. The goodwill portion cannot be written off. The immediate expensing is restricted or denied in certain related‑party scenarios, such as family succession or a transfers between companies under common control. - Share Purchase: In a share deal, the buyer purchases the company, not its assets, so there is no new write-off. The company keeps whatever deductible cost its assets still carry. If the seller already wrote off recent equipment purchases, little deductible cost remains, and the company pays more tax after closing. Two targets with the same EBITDA can leave the buyer with very different after-tax cash. The Price Allocation Negotiation - In an asset deal, the purchase price is split across the assets acquired, mainly equipment and goodwill. The buyer wants more assigned to equipment, because that amount is now written off in year one. The seller wants less, because the gain on equipment, up to what the seller originally paid, is taxed as ordinary income. Goodwill the seller built itself is taxed as a capital gain, only half of which is taxable. - An owner selling shares of a qualifying small business can shelter up to CA$1.275 million of the gain under the Lifetime Capital Gains Exemption. In an asset sale, the company sells the assets, so the owner cannot use the exemption. The measure makes asset deals more valuable to buyers, while sellers prefer share deals. Whatever split is agreed must reflect fair value, since the Canada Revenue Agency can reallocate an unreasonable split. What This Means For Dealmakers The write-off does not change EBITDA. Its value shows up in after-tax cash, which leaves the buyer more money in year one to service acquisition debt on an asset deal.