Q1’26 Pulse of Private Equity

PE market activity in the US remains concentrated on high-conviction deals

During Q1’26, the US saw $228 billion in PE investment, a solid start to the year, despite a marginal dip in the 12-month rolling investment total from $1.17 trillion in Q4’25 to $1.12 trillion in Q1’26. However, PE deal volume remained very subdued, with just 1,811 deals during the quarter; the 12-month rolling deal volume total also fell significantly, from 9,130 deals in Q4’25 to a five-year low of 8,536 deals in Q1’26.

PE investors in the US continued to concentrate activity on a small number of large, high-conviction transactions. The energy sector, viewed as a critical enabler of future AI growth, attracted the largest deal of the quarter: the completed take private of clean energy company AES by a consortium including Global Infrastructure Partners and EQT for $41 billion. Other large deals included, the take private of enterprise financial management firm OneStream by Hg Capital for $6.4 billion, and the take private of Clear Channel Outdoor Holdings by Mubadala Capital and TWG Global for $6.2 billion.¹

Geopolitical and macroeconomic uncertainties strengthen in Q1’26

Despite optimism entering Q1’26, geopolitical tensions and macroeconomic uncertainties reared their head again in Q1’26, including renewed tariff uncertainty, the escalating geopolitical risks associated with the conflict involving Iran and the resulting energy market volatility. Interest rate uncertainty also re-emerged as a key gating factor, with expectations for rate cuts pushed out as inflation risks resurfaced. By the end of Q1’26, PE activity was clearly moderating, particularly in terms of mid-market activity and auction-driven processes, where volatility in public markets and credit spreads made underwriting more difficult.

Add-on transactions a consistent play as PE investors focus on value creation

During Q1’26, add-ons remained one of the most consistent areas of PE activity in the US. With holding periods extended and exit markets still constrained, sponsors focused on add-ons as a primary lever for value creation. During the quarter, there was a notable focus on smaller, executable transactions aimed at deepening capabilities, expanding product offerings or strengthening geographic reach. Sponsors in the US also increased their focus on buy-and-build execution strategies in fragmented sectors like healthcare services, B2B software and industrial tech; bolt-on transactions aimed at delivering scale efficiencies or extending control over supply chains rather than speculative expansion; and secondary and tertiary sponsor-backed consolidations in order to drive operational value creation.

Trends to watch for in Q2’26

Heading into Q2’26, the PE market in the US will likely be defined less by broad-based recovery and more by selectivity, scale and macro-sensitivity. While PE firms continue to have significant dry powder to deploy, they are expected to continue to concentrate on high-conviction deals and in deals at the top end of the market in areas like infrastructure and energy.

The macroeconomic environment will be critical to watch in the short term as it could have a meaningful impact on shaping near-term activity. Geopolitical risks and conflicts combined with renewed tariff uncertainties and concerns about potential inflation and interest rate increases are causing some friction in the dealmaking process, lessening confidence, widening bid-ask spreads and extending timelines, particularly for mid-market deals. Overall, Q2’26 will likely see continued deal activity, with a return to more cautious underwriting and a greater focus on pricing discipline.

Infrastructure is increasingly becoming the new mega-buyout category, with assets linked to energy, digital infrastructure and data centers attracting the deepest pools of capital. To take advantage of these opportunities we’re seeing much greater use of consortiums often involving a range of investors from PR to sovereign wealth and institutional investors. These consortium deals are very targeted and thematic, focused on ‘must-own’ assets where scarcity and strategic importance matter as much as financial returns.

Donald Zambarano

US Head of Private Equity

KPMG in the US

Pulse of Private Equity Q1’26

A KPMG quarterly analysis of global private equity activity.

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Pulse of Private Equity Q4’25

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A KPMG quarterly analysis of global private equity activity.

In Q1’26, Americas PE-announced four-quarter sums amounted to $1.2T across 9,400 transactions.

In Q1’26, EMA PE-announced four-quarter sums amounted to $718.6B across 8,522 transactions.

In Q1’26, ASPAC PE-announced deals amounted to $128.5B across 1,208 transactions.

¹ investor.clearchannel.com, “Clear Channel Outdoor Holdings, Inc. Agrees to be Acquired by Mubadala Capital, in Partnership with TWG Global, for $6.2 Billion,” 9 February 2026