PitchBook News - A year of change in the UK

Lower rates are also favoring LBO deals in PE, with discounted valuations in the region fueling a significant amount of take-private activity. The latter has supported public equity valuations, too.

It is therefore difficult to disentangle how much of the rally is buoyed by take-private activity versus fundamentals. A step change to the latter will be needed for listings activity to improve, with exits remaining the weakest area for the region across VC and PE markets.

Given it is the largest ecosystem in Europe, the UK will continue to prove a barometer for wider European activity. However, the fostering of fast-growing ecosystems, such as AI, will be critical for maintaining its leadership, where other regions such as France are catching up—doubling its share of European AI deal value in H1.

In a market that is becoming more specialized by strategy, we expect managers that can capitalize on nascent, structurally growing technologies, such as AI and cleantech, will be well-placed longer-term.

For more data and analysis into UK public and private market trends, download our free research:

UK Private Capital Breakdown

UK Market Snapshot