US take-private transactions have provided a reliable channel for PE capital deployment in a volatile buyout market where early momentum in 2025 cooled in the second quarter.
US buyout deal value increased year on year through the first six months of 2025—climbing from US$195.5 billion in H1 2024 to US$289.9 billion in H1 2025—though Q2 figures dipped 16 percent from Q1 numbers. At the time of writing (August 20), total buyout value had risen to US$339 billion, comfortably beating the first three quarters of 2024 (US$327 billion).
Buyout deal volume, meanwhile, dropped year on year in the first half, down from 1,718 deals in H1 2024 to 1,481 in H1 2025, where there was also a drop from Q1 (798 deals) to Q2 (683 deals). By August 20, total volume had increased to 1,848, still some way short of the 2,570 buyouts conducted by the end of Q3 2024.
The fluctuating figures reflect a challenging macroeconomic backdrop. US dealmakers began the year in an optimistic mood, with a new, business-friendly administration taking office and interest rates forecasted to start coming down. Momentum slowed in the second quarter, though, as tariff uncertainty put the brakes on deal flow and GPs paused to assess the levies’ potential impact on portfolios and prospective investment targets.
Public-to-private keeps delivering
One deal channel that’s stayed open and consistently provided buyout managers with opportunities to deploy large amounts of capital is the public-to-private market.
Dealogic figures recorded 26 take-private deals in the US in the first half of 2025, with a combined deal value of US$76.3 billion. Although take-private deal volume fell from 36 deals in H1 2024, value fell by just 6 percent year on year. Despite the slight year-on-year drop-off, this represents the third-highest half-yearly value total since 2020, as PE managers found opportunities to invest in large, listed companies across a range of sectors.
The VIX index, a measure for equity market volatility, climbed to the highest levels seen since the pandemic in H1 2025, creating price dislocation across stock markets and opening a window of opportunity for buyout firms to acquire public companies at attractive valuations.
With private M&A deal flow stuttering, public-to-private deals have helped managers—under pressure to put an estimated US$1.2 trillion of ageing buyout dry powder to work—to sustain deployment. Bain & Co estimates that nearly a quarter of this capital has been available for four years or more.
Pricing dislocation, however, has not been the only driver of deal activity. For specialist PE firms with specific sector expertise, public-to-private deals have also presented opportunities to acquire prized, blue-chip assets in their target verticals.
In the largest US take-private of the year, for example, retail specialist Sycamore Partners acquired drug store chain Walgreens in a US$23.7 billion deal after tracking the business for more than a year, according to reports.
In the third-largest public-to-private of H1 2025, another specialist firm, consumer-focused 3G Capital, acquired footwear company Skechers in a US$11.3 billion deal, marking a return to dealmaking after an extended stretch of waiting for the right transaction target to emerge.
The second-largest US take-private during the first six months of the year, meanwhile, saw Blackstone Infrastructure agree an US$11.5 billion deal to delist New Mexico power generator TXNM Energy. Power generation has been a busy area for investment, with electricity demand in the US increasing due to data center construction growth and the wider electrification of the economy.
Deal flow abounds, but caution advised
In the second half of 2025, public-to-private deals are set to remain a key pipeline for PE deal flow in a still uncertain M&A market. According to Dealogic figures, by August 20 there had been 12 US take-privates in Q3 2025, bringing the full-year total to US$85.3 billion from 38 deals.
The dynamics driving take-private opportunity, however, are expected to evolve, and buyout sponsors will have to adapt investment strategies accordingly.
Opportunistic take-privates, in which wider stock market volatility opens windows to buy assets at discounted valuations, may be harder to find. US stock markets have adapted to tariff uncertainty and valuations have rallied, with the S&P 500, for one, now trading at near-record highs.
Fuller entry prices will take the shine off some take-private opportunities, and dealmakers will have to be pickier about the public-to-privates they pursue. Companies in complex sectors such as consumer and manufacturing, which have direct exposure to increasing tariffs, may allow PE firms to “buy the dip,” but finding undervalued assets will require managers to tread a fine line between backing assets that are simply undervalued by stock markets and avoiding those exposed to genuine, long-term commercial risk.
Public-to-private deal rationales are more likely to be driven by commercial fundamentals than opportunistic transactions, where arbitraging stock market pricing inefficiencies is the main driver.
Mergermarket reports that small and mid-cap listed companies in sectors such as SaaS, or software as a service, will be open to going private as growth slows and spending on technology pivots from software and cloud computing to fund swelling AI budgets. AI could also have a dilutive impact on subscriber numbers and revenue.
Companies in this space with market capitalizations in the US$2 billion to US$10 billion range will be an ideal fit for specialist technology buyout firms that see an opportunity to consolidate the subsector and build large platforms with the scale to navigate market headwinds and changes.
Mid-cap companies with market capitalizations below US$5 billion are also set to generate more public-to-private flow.
These smaller, listed companies have found it more difficult to ride out short-term volatility and steer through quarterly reporting scrutiny without the scale of bigger businesses. These assets often do not benefit from the same liquidity and investor attention. More than a third of the S&P 500’s overall market cap is comprised of the so-called Magnificent Seven stocks—Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia and Tesla—which absorb the bulk of investor attention and capital.
Moving off public markets and away from the quarterly reporting cycle, to working with PE shareholders, can appeal to the management teams and shareholders of smaller businesses.
Outlook
In a still volatile macroeconomic climate, forecasting the trajectory of take-private deal flow is hostage to fortune.
However, even though pricing arbitrage opportunities have abated for now, PE firms will continue to comb public markets in the months ahead for unloved or undervalued listed companies that are a good fit for GP investment strategies and sector strengths.
[View source.]
