Australia and New Zealand Private Equity Market Update After First Half of 2026 is Alvarez & Marsal's briefing on the region's investment cycle. It covers deal activity, sector allocation, exit conditions, and fundraising through the first half of 2026, a period marked by tighter monetary policy, persistent inflation, and a selective rather than broad-based recovery in market activity.

Summary

Deal volume surpassed 250 transactions in H1 2026 even as the RBA raised the cash rate 75bps to 4.35%, with growth concentrated at the smallest and largest ends of the market while the mid-market remained slower to clear. Capital moved toward cash-generative, real-asset, and defensive themes, with Business Services and Healthcare together accounting for nearly 65% of deal value. Exit value held up despite a steep drop in volume, driven by a smaller number of larger realisations, as strategic acquirers gained share and IPO activity declined sharply. Fundraising remained concentrated, with a 14x gap between capital raised by experienced versus emerging managers, and a clearer distributions track record emerging as a key factor in accessing Limited Partner capital.

What this article covers

• How Australia and New Zealand PE activity performed through H1 2026 against a backdrop of tighter monetary policy, persistent inflation, and elevated energy costs.
• How deal activity split between smaller sub-US$25 million transactions and a limited number of large assets, while core mid-market processes remained slower to clear.
• Where capital moved by sector, and the different factors driving activity in Business Services, Healthcare, Materials, and Energy.
• How exit value held up on lower volume, what drove average exit size higher, and how the mix between sponsor buyouts, strategic acquisitions, and public listings shifted.
• How the gap between experienced and emerging fund managers reflects a broader shift in Limited Partner allocation preferences, and what this suggests for fundraising through the remainder of 2026.