PE firms squeezed as Swiss M&A rebounds

Swiss M&A activity has rebounded sharply this year, but private equity firms are capturing a smaller share of transactions as cash-rich corporate buyers become more aggressive in the market, according to a report by Bloomberg.

Deal value in Switzerland reached approximately $44bn in the first eight months of 2026, up around 20% year-on-year and slightly above the country’s eight-year average, according to Boston Consulting Group. The recovery forms part of a broader global revival in M&A activity, with companies deploying stronger balance sheets and improved earnings despite geopolitical and energy-market uncertainty.

However, private equity accounted for only about $8bn of Swiss transactions during the period, making it the second-lowest annualised level recorded over the past eight years.

BCG partner and managing director Jeremy Merz said the decline in sponsor activity was being driven partly by the increased appetite of strategic buyers, alongside pressure on some private equity managers to realise existing investments before returning to the market to raise and deploy fresh capital.

The largest Swiss transactions of the year have largely been corporate-led. Zurich Insurance Group agreed a $10.9bn acquisition of UK specialist insurer Beazley, while ABB agreed to acquire UK-listed automation company Rotork for $5.6bn.

Private equity’s $8bn contribution included CVC Capital Partners’ $2.6bn acquisition of DSM-Firmenich’s animal nutrition and health business and Lone Star’s deal for part of chemicals group Lonza.

Merz described the relatively low sponsor share as a phenomenon specific to Switzerland, noting that private equity has continued to account for a comparatively high proportion of deal activity in other markets.

The competitive environment was also highlighted by KKR co-CEO Scott Nuttall, who said strategic buyers currently have advantages in transactions because of stronger liquidity and lower financing costs.

When private equity firms compete directly against highly motivated corporate acquirers, Nuttall said the strategic buyer will often prevail, although he suggested the current dynamic could prove temporary.

For private equity managers, the challenge extends beyond winning new acquisitions. The industry is also under pressure to generate distributions for investors as exits remain difficult and holding periods have lengthened.

Managers have increasingly turned to alternative methods of extracting liquidity from portfolios, including dividend recapitalisations, net asset value financing secured against groups of portfolio companies and continuation vehicles that transfer assets into new investment structures.

Nuttall said he expects the continuation fund market to remain active, pointing to the growing importance of GP-led transactions as sponsors look for ways to provide liquidity to existing investors while retaining exposure to assets they believe still have further value-creation potential.