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Bailey McCann, Opalesque New York: Middle market private equity is showing signs of recovery, but it may be a while before that equals cash in hand to investors. New data from Pitchbook shows that funds started getting deals done in the third quarter, exits remain weak.
Deal count jumped 24.1% QoQ
to an estimated 1,124 transactions, while deal value edged up
2.5% to an estimated $90.4 billion. An estimated 235 exits totaling $27.6 billion closed in Q3,
and annual activity is pacing roughly 15% below 2025 on both
count and value, according to PitchBook data.
Perhaps most notably, fundraising is coming back. Through
Q3, middle-market funds raised $108.6 billion across 101
fund closings, already 85.1% of 2025's total, but capital is
concentrating at the top: Funds of $1 billion to $5 billion
captured a record 76.7% of capital raised. Institutional investors are still being rather selective about where they allocate capital, but this is likely a positive trend for GPs. Pitchbook analysts note that if fundraising is to remain elevated through 2027, it will likely be determined by the pace of exits.
Going forward, cost of capital will likely become a sticking point in deals. Investors retreated from large financing dependent deals in the second quarter as questions over interest rates loomed large. As of the November Federal Reserve meeting, interest rates are likely to remain elevated at least until the next meeting. However, that does provide the market with some n...................... To view our full article Click here
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