Weekly Private Equity Edition
Volume 18
SEQH CAPITAL RESEARCH
Private Equity Edition – Weekly Brief
Week Ending March 13, 2026
Top Takeaways
Private equity sentiment has flipped from defensive to offensive, with Q1 2026 sponsor confidence at a six‑year high and megadeals now a weekly occurrence across technology, healthcare, and energy.
Liquidity is still the binding constraint: private credit redemptions and bank de‑risking are forcing a repricing of leverage, but current stress remains a redemption and confidence shock rather than a broad default cycle.
GPs are converging on the same playbook: pay up selectively for scale platforms in “AI‑adjacent” infrastructure and resilient cash‑flow sectors, lean harder into operational value creation, and use continuation vehicles and secondaries as core liquidity tools.
Market Pulse: Deployment Is Accelerating, Not Just Talking
Multiple independent data points this week corroborate what we are seeing anecdotally in deal flow: the “great thaw” in private markets is now well underway.
A series of Q1 outlooks (Bain, McKinsey, regional M&A surveys) show dealmaker confidence at or near six‑year highs, with multi‑billion‑dollar megadeals now “a weekly occurrence” across tech, healthcare, and energy.
By early March, sponsors have already announced or signed tens of billions of dollars in take‑privates and carve‑outs, including industrials, energy, data infrastructure, and financials, contributing to what Bain characterizes as a “gaining traction” phase of the 2026 cycle.
Stabilized interest‑rate expectations are the key enabler: by March 9, sponsors can again “accurately model their long‑term cost of capital,” unlocking deal committees that had been blocked by rate volatility rather than lack of appetite.
Original quant lens: If you model PE deal activity as a function of (1) rate volatility, (2) equity valuation dispersion, and (3) dry‑powder age, the current regime scores as follows:
Rate volatility: sharply lower versus 2022–2023, decreasing discount‑rate uncertainty.
Valuation dispersion: still elevated (especially between AI‑exposed software and “old economy” cash‑flow names), increasing the opportunity set for relative‑value trades.
Dry‑powder age: more than 40% of buyout dry powder is 2+ years old, the highest on record, which historically correlates with a 1–2 year window of accelerated deployment and more aggressive underwriting.
Our base case for clients: 2026–2027 is shaping up as a high‑volume, high‑dispersion deployment window where deal selection and capital structure will dominate factor beta.
Liquidity Stress in Private Credit: Where Are We Now?
