The potential impact of a dividend tax hike—up to 20 percent or higher—is driving a sudden boom in business activity, Lawrence Golub, president of Golub Capital told CNBC's "The Strategy Session" on Tuesday.
"We have a pipeline of 96 separate middle-market transactions that are trying to close by years end—record levels," Golub said."These are companies with an enterprise value of about $400 million dollars or less."
President Obama is pushing to end the Bush tax cuts for the wealthiest Americans, which are set to expire December 31. The tax cuts were enacted in 2001 and 2003 under President Bush and lowered rates across the board on income, dividends and capital gains.
There are three potential tax moves "driving a boomlet [a small period of rapid growth in the market] through the LBO (leveraged buyout) business," Golub said, referring to potential increases in the tax rates on dividends, capital gains, and carried interest (a form of income earned by hedge fund managers).