Healthcare, energy, and infrastructure push past 2024 totals despite global private equity slowdown
Private equity investors are gravitating toward healthcare, infrastructure, energy, and life sciences, as global instability and tariff uncertainty drive a shift away from risk-heavy deals and toward resilient, domestic-focused assets.
According to KPMG’s 'Pulse of Private Equity' for Q2’25, investment in these sectors surpassed 2024 full-year totals by midyear, with healthcare reaching $79.3bn, infrastructure at $74.4bn, and life sciences climbing to $6.9bn from $4.2bn last year.
Energy and Natural Resources also attracted $110.8bn by midyear, already ahead of the $106.95bn recorded for the entire previous year.
Despite this sector-level strength, overall global PE investment dropped to $363.7bn across 3,769 deals in Q2’25 from $505.3bn across 4,527 deals in Q1’25, as per the report.
The decline was especially steep in the Asia-Pacific region.
KPMG reported that investment there fell to $20.8bn from $36.2bn, marking the region’s weakest quarter, with China contributing just $700m — its slowest on record.
Japan attracted $3.6bn, while Australia posted a strong quarter with $11.2bn, more than doubling its Q1’25 figure. South Korea also captured three of the region’s top 10 deals.
The Americas saw investment fall to $213.96bn from $319.8bn the previous quarter.
In the US, investment declined to $202bn from $264.5bn.
Canada recorded $6.1bn across 104 deals in Q2’25, following a record-breaking Q1 — marking the country’s weakest quarter since 2020.
Investment in the Europe, Middle East, and Africa (EMA) region dropped to $117.4bn across 1,669 deals, the lowest in eight quarters, as per KPMG.
Still, the UK rebounded with $36.8bn in Q2’25 from $24.9bn in Q1’25. Germany held steady at $15bn, while France saw a sharp decline to $14.5bn from $29.5bn.
While deal activity shrank, median deal sizes rose across all stages.
Buyout deal size increased from $82.3m in 2024 to $104.5m, M&A deals grew from $19.7m to $34.7m, and PE growth deals climbed from $18m to $25m.
Fundraising also slowed.
KPMG noted that only $225bn was raised across 248 funds by the end of Q2’25 — well behind 2024’s annual total of $554.2bn.
Based on a rolling 12-month basis, global fundraising reached $442bn across 608 funds, down from $492bn across 647 funds in Q1’25.
The number of new funds fell sharply, with just 1,255 funds raised in the first half of 2025 compared to 2,511 during the same period last year.
Fund size composition shifted away from mega-funds and sub-$100m funds toward mid-sized funds in the $100m–$1bn range.
TMT remained the largest sector by total investment with $247.2bn globally, although still behind pace to match its $649.9bn in 2024. Industrial Manufacturing followed at $132.4bn.
“There will always be big deals that come through,” said Gavin Geminder, global head of Private Equity at KPMG International.
He added that private equity isn’t likely to miss out on “truly world class global assets if they become available,” but noted a shift in investment toward regional and domestic companies due to the unpredictability of ongoing tariff wars.
Geminder said PE firms are increasingly relying on continuation vehicles to hold assets amid difficult exit conditions.
However, he noted that “a lot of LPs are getting tired of this and are concerned about potential returns and the possibility of stranded assets.”
He added that as pressure builds, the market could see some forced sales in the next quarter.
Looking ahead to Q3’25, the report indicated investors are expected to maintain a cautious stance, with emphasis on sectors offering long-term resilience and assets focused on local markets.
