A majority of private equity firms around the world expect their dealmaking plans to be negatively impacted by increased scrutiny from regulators over the next 12 months, according to a Dechert and Mergermarket report.

The 2025 Global Private Equity Outlook survey found that 66% of respondents are anticipating greater scrutiny from antitrust, FDI and other regulatory authorities, while 46% believe geopolitical conflict will weigh on deal activity over the near term. More than a quarter (27%) also expect weak economic growth to dampen the deal environment over the next 12 to 18 months.

These concerns come against a brighter start to global private equity activity this year. While transaction volumes were flat in the first three months of the year, the value of those deals rose 47% to $703bn compared to the same period in 2023, the report showed. In the EMEA region, deal values rose to $203bn in the opening quarter, up from $119bn over the same period last year.

Chris Field, co-head of Dechert’s private equity practice, said: “Whilst we have not seen a return to the levels of activity seen in 2021 and early 2022, dealmaking is robust when compared with the pre-pandemic years.”

Despite the challenges on the horizon, Field expects conditions should improve next year supporting a stronger dealmaking environment.

As many as 93% of respondents said they are at least somewhat likely to consider take-private deals over the next 12 months, while 82% of respondents expect secondaries activity to remain buoyant or increase in the next two years, adding to the growth seen over the past five years.

More than a third of respondents (34%) said they are also exploring GP-stake divestitures in the next two years.

With public markets improving and borrowing costs easing, private equity professionals expect to see more exit opportunities ahead.

“The system has been clogged,” said Field. “Exits haven’t been happening as often because sellers were wanting prices that were too high to work for buyers when they put the numbers into their models; now that rates are reducing, the models start to look better, and the cycle begins to spin again.”

The report’s findings were based on a survey of 100 senior-level executives at private equity firms in North America, EMEA and Asia Pacific with at least $1bn of assets under management.