European Private Equity Value Creation Report 2026

Operational Alpha: How Private Equity is Building Value in a New Cycle

Now in its fifth edition, the European Private Equity Value Creation Report explores how private equity firms are being forced to rethink how they create value as renewed geopolitical volatility, high entry valuations and prolonged exit timelines reshape the industry.

Returns are increasingly driven by hands‑on operational improvement rather than favourable market conditions. The insights in this report reflect an industry that is using a difficult cycle to sharpen its model and grow on stronger foundations.

Based on a survey of over 200 private equity professionals and portfolio company executives across Europe, the report explores how sponsors are adapting their strategies, accelerating execution, using AI more selectively, and turning to continuation funds to protect and extend value in a more complex investment environment.

Click on the button below to access the full survey findings and insights.

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Value Creation Report 2026 Key Takeaways

Operational value creation is now the primary driver of returns

In today’s more volatile deal environment, EBITDA growth is increasingly coming from operational improvement rather than top-line expansion. Margin improvement now accounts for roughly half of EBITDA growth in exited European PE investments, a sharp increase from prior years.

Geopolitical volatility has overtaken inflation as the top challenge

Geopolitical shocks are now cited as the single biggest barrier to value creation and returns, forcing sponsors to rethink assumptions around timing, execution, and exit readiness.

AI is moving from experimentation to measurable impact

Nearly two-thirds of funds now use AI within value creation programmes, with adoption expanding across multiple functions. The most common applications include data analysis, operational efficiency, pricing analytics, forecasting, procurement, and finance optimisation.

Exit timelines are stretching, changing liquidity strategies

With exits stalling, private equity firms are extending hold periods and value creation plans. Use of continuation funds and the secondaries market has nearly doubled year on year as sponsors seek liquidity in a subdued exit market.

Continuation funds accelerate in Europe

Use of continuation funds and the secondary market has nearly doubled year over year. These structures are increasingly used to preserve value in high‑quality assets rather than forcing exits at discounted valuations. Sponsors are holding good assets for longer, but aligning with LPs is a challenge.

Steffen Kroner shares the current trends in private equity

Value creation is shifting beyond M&A toward operational, IT, and AI-driven transformation. For 40 years, A&M has helped management teams unlock value and accelerate performance through an operational, action-oriented approach.

A&M Managing Director Steffen Kroner highlights how large-cap funds are using AI to scale efficiency, address valuation gaps through continuation vehicles, and drive cost effectiveness and data monetisation.

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