Private Equity Report: 2025 Outlook

January 2025
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Letter from the Editors

The private equity industry enters 2025 amidst numerous positive indicators. Investors are returning to private equity strategies after having been kept on the sidelines by poor macroeconomic conditions in 2022 and 2023. Interest rate cuts by both the Federal Reserve and the European Central Bank are now creating a more favorable liquidity and dealmaking environment. Both capital markets and alternative financing markets are strong. Donald Trump’s victory in the U.S. presidential election altered the U.S regulatory outlook overnight, promising a return to a less aggressive and more predictable approach by regulators in a wide range of areas, including antitrust, SEC enforcement, ESG and noncompetes. And the European Union introduced a “simplification revolution” with the goal of reducing EU reporting requirements by 25%.

But there are also new complexities with which to contend. Geopolitics is an increasingly concrete concern, with new outbound investment regulations taking effect in the United States, CFIUS scrutinizing private equity transactions and North Korea undertaking a sophisticated campaign to infiltrate the systems of U.S. businesses (while generating revenue for state coffers). A recent U.S. Supreme Court ruling brings new considerations when conducting due diligence of a portfolio company’s or target’s trademark portfolio. The legal landscape regarding governance rights provisions in stockholder agreements continues to evolve. And if the Trump administration puts ESG on the federal back burner, companies must still navigate a patchwork of ESG regulations across U.S. state jurisdictions, as well as in the United Kingdom and the European Union.

We hope you find the 2025 Private Equity Outlook to be a useful summary of both the positive developments and the new challenges shaping the market as you navigate the year ahead.