Survey highlights value creation strategies emerging trends like AI and ESG as key levers for success amid tariff and trade challenges.

SYDNEY, September 10, 2025 – Leading global professional services firm Alvarez & Marsal (A&M) has released its latest report, offering a comprehensive analysis of the Australian private equity (PE) landscape in 2025.

The findings reveal that Australian PE funds are navigating a complex macroeconomic environment, marked by geopolitical volatility, trade disruptions, and extended holding periods. Despite these challenges, the industry remains cautiously optimistic, with 68% of surveyed investors expressing confidence in exit prospects over the next three years. The report highlights how PE funds are driving productivity and growth across industries, positioning themselves as catalysts for Australia’s next chapter of economic resilience. 

Key Findings from the Report: 

• Tariffs Reshaping Portfolio Strategies: 55% of respondents continue to pursue acquisitions but with greater diligence on tariff impacts, while 28% are ramping up value creation initiatives to offset rising costs caused by tariffs. Funds are also exploring alternative supply chain strategies, such as reshoring to mitigate risks and build resilience.
   
• AI Adoption on the Rise: 50% of surveyed funds are already using AI in pre-deal diligence and post-deal value creation, with applications ranging from due diligence to operational efficiency initiatives. This reflects a growing trend of integrating technology into PE playbooks to unlock value.  
   
• Barriers to Execution: Capability gaps (82%) and capacity constraints (69%) remain the biggest hurdles to executing value creation plans, underscoring the need for specialised expertise and resources.
   
• Value Creation as a Core Strategy: An overwhelming 95% of respondents identified value creation as central to their investment thesis, with 74% targeting both revenue growth and cost reduction in tandem. Funds are increasingly deploying advanced tools like AI to enhance operational efficiency and drive growth.
   

• Navigating Tariff and Trade Volatility The report highlights how global trade disruptions including tariffs and ongoing global tensions, are reshaping investment strategies. By embedding tariff and trade risks into diligence processes and value creation plans, funds are building resilience and positioning their portfolios for long-term success. 

  Value Creation No Longer Optional

  "Value creation is no longer just a lever for growth; it is the foundation of private equity success in today’s market” said Timo Schmid, Managing Director, Private Equity Performance Improvement. “With 95% of funds identifying value creation as central to their investment thesis, the focus has shifted to operational excellence and strategic execution to deliver sustainable returns."

  About Alvarez & Marsal

  Founded in 1983, Alvarez & Marsal is a leading global professional services firm. Renowned for its leadership, action, and results, A&M provides advisory, business performance improvement, and turnaround management services, delivering practical solutions to address clients' unique challenges. With a worldwide network of experienced operators, world-class consultants, former regulators, and industry authorities, A&M helps corporates, boards, private equity firms, law firms, and government agencies drive transformation, mitigate risk, and unlock value at every stage of growth.
   

  ---

  For queries: Marjorie Johnston + 407 329 430 marjorie@wordmakers.com.au