The Private Equity Trend Report 2026, published by PWC, features an overview of the European private equity (PE) market, along with insights from 250 PE principals based in the region.

Highlights include:

• A market of two halves. Aggregate European PE deal value jumped 28% to €457.6 billion in 2025, even as transaction count slipped 8%, revealing a bifurcated market where megadeals flourished and the mid-market quietened. Sponsors deployed more capital per transaction, chasing add-ons, carve-outs, take-privates and platform consolidations while smaller deals were waiting for valuation alignment.
• Dislocation is an opportunity. Global conflict and political turbulence have become unlikely dealmaking catalysts: 55% of respondents reported that geopolitical disruption, protectionism and trade uncertainty actually supported increased investment activity in 2025, as firms identified opportunity amid volatility.
• Competition has reached new intensity. The search for quality assets has never been fiercer: 67% of respondents reported increased competition for investments compared with 2024, with sector specialisation and demonstrable transformation capabilities now the key competitive advantages.
• Returns have recovered their footing. After years of pessimism, performance expectations are rebounding: 61% of respondents reported that returns on investments made during the past five to seven years met expectations, with 21% exceeding them – a marked improvement from last year’s survey when 37% reported disappointment.
• Confidence in recent vintages. Recent investments are expected to outperform historical holdings, with 46% of respondents anticipating that returns on deals done in the past year will exceed those from five to seven years ago, as GPs exercise more disciplined entry pricing and more actively apply operational stewardship.
• AI adoption is accelerating. Digital transformation has moved from experiment to imperative: 88% of firms have made investments to digitally transform their organisations, and 94% noted that they will be investing in digitalisation in the coming year.