The EMA region has attracted a very solid level of PE investment in 2025 so far, with $474.2 billion in PE deal value as of the end of Q3’25 — within striking distance of 2024’s annual investment total ($647 billion). Q3’25 saw announced PE deal value in the EMA region rise to $178 billion during Q3’25 — well ahead of the same quarter last year, which saw $145.4 billion of investment. Deal volume, however, was much softer, with 1,736 announced deals compared to 2,168 in Q3’24; the region hasn’t seen such low deal volume since Q3’20.
Despite soft deal volume, PE investment in EMA region quite healthy
Hesitation continues to permeate the EMA market
Within the EMA region, PE investors continued to show significant hesitation with respect to closing deals. A number of factors contributed to this hesitancy — from political challenges in France to slower than expected development in Germany. This hesitancy likely affected PE investment and deal activity in the region, in addition to the typical seasonal slowdown often visible in Q3.
Despite the current market softness, there is growing optimism in the EMA market, driven by positive sentiment on the macroeconomic front, including inflation settling down and the growing sense that additional interest rates cuts are on the horizon. The US’s tariff policies also haven’t had as much of an impact as initially expected, although some sectors and jurisdictions — such as the automotive industry in Germany — have been more affected than others.
Healthcare attracts robust PE investment in EMA
As of Q3’25, the healthcare sector in the EMA region had already seen $42.5 billion in PE investment — already well above results seen in both 2023 ($35.5 billion) and 2024 ($38.1 billion) and within reach of 2022’s peak high of $54 billion). The strong level of investment was powered by a number of $1 billion+ deals in the space, including the $2.9 billion public-to-private buyout of Bavarian Nordic in Q3’25. A number of factors have helped the healthcare sector’s resilience and strength in terms of attracting PE investment this year, including the sector’s insulation from US tariffs given its largely domestic or regional focus. As the time since the COVID-19 pandemic passes, healthcare assets are also able to show a cleaner and more predictable track record of asset performance — strengthening their saleability.
Exit opportunities in EMA limited by closed IPO door
Exit activity in the EMA region continued to be quite slow in Q3’25, with $220 billion in exit value across 936 exits as of the end of Q3’25 — compared to $340.5 billion across 1,675 deals during all of 2024. Effectively, the IPO door has remained firmly shut in the EMA region — outside of India’s outlier market — with very limited deals managing to occur. With the lack of IPO exit opportunities, the completed exits in the region over the last year have primarily occurred through purchases by strategics willing to pay reasonably high prices in order to gain synergies or by PE firms seeing opportunities to bring companies to the next level.
Trends to watch for in Q4’25
There is growing optimism in the PE market in the EMA region heading into Q4’25 and 2025. Macroeconomic conditions are improving, creating better financing conditions — and so supporting higher deal values. Large cap is beginning to come back. Over the medium to long term, Germany, France, and the UK are expected to see increasing PE interest in spaces like infrastructure and defense, particularly driven by governments supporting a shift towards critical ecosystems that are less reliant on other jurisdictions.
Continuation vehicles and secondary transactions are expected to remain important over the next few quarters in the EMA region. A lot of eyes will also be on the IPO market to see when any breakthrough IPOs occur; the opening of the IPO exit route in the region will likely be critical for unlocking more exits.
Pulse of Private Equity Q3’25
A KPMG quarterly analysis of global private equity activity.
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