Carlyle Group expects private equity dealmaking to accelerate in 2026 as several of the obstacles that slowed activity last year have begun to clear, according to Steve Wise, co-head of the firm’s Americas corporate private equity business.

“2025 was a tricky year,” Wise said in an interview with Bloomberg Television. He added that many of the factors that weighed on transactions have since eased, including uncertainty around US government cost-cutting efforts and the potential fallout from President Donald Trump’s tariffs, which he said “weren’t bad”.

Wise said improving economic growth and widening corporate margins are helping bring buyers and sellers closer together on valuations. “There is more of a meeting of the minds between buyers and sellers,” he said. “I think you will see activity begin to accelerate.”

The private equity industry has faced a prolonged slowdown in both dealmaking and fundraising amid higher interest rates and macroeconomic uncertainty. However, sentiment has begun to improve. Wise pointed to growing optimism among both corporate and private equity dealmakers, citing a Deloitte survey released in November that showed expectations for stronger activity in the year ahead.

Carlyle sees the strongest opportunities emerging in defence and industrials, sectors it expects to benefit from the reshoring of manufacturing capacity in the US. Wise said the firm anticipates the ISM Manufacturing Index to rise above 50, a level that would signal expansion in industrial activity. He also expects corporate carve-outs to increase as companies seek to streamline operations.

“There’s been a lot of headwinds in the industrial sector,” Wise said. “People have been waiting for that to turn — we think that is going to happen.”

Carlyle ended last year with the IPO of healthcare supplier Medline, the largest public listing of the year, which continues to trade above its offer price. Wise said the firm has returned $12bn of capital to investors over the past two years and has generated more exits than any of its peers.

The comments underscore growing expectations among large buyout firms that deal flow will recover as financing conditions stabilise and valuation gaps narrow across key sectors.

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