The rules of mergers and acquisitions have shifted for private equity firms seeking to exit investments. According to Investec, successful exits now hinge on three factors: demonstrating AI resilience, executing smarter sale processes, and adopting a more pragmatic approach to valuation.

Earlier in 2026, a sharp sell-off in software stocks—widely dubbed the "SaaSpocalypse"—revealed how rapidly AI can reshape company valuations. Businesses that once attracted premium multiples now face intense buyer scrutiny, as acquirers seek to determine whether competitive advantages can withstand the next wave of AI adoption. For PE firms, many of which have already extended holding periods well beyond the traditional five-year window, this reassessment has compounded the challenge of returning capital to limited partners who have grown increasingly vocal about distributions.

Private equity firms remain under pressure to return capital to investors, even as the value of global private equity exits fell to $96bn in the first quarter of 2026, according to Preqin.

1. Buyers Demand Proof of AI Resilience

Companies can no longer rely on sweeping claims about productivity gains. Buyers want concrete evidence that a business possesses defensible advantages—whether through proprietary data, trusted customer relationships, regulatory expertise, or physical capabilities. They also expect to see that management teams are leveraging AI to strengthen operations proactively rather than merely reacting to industry changes.

As AI capabilities become more widespread, the businesses that distinguish themselves are those able to show how their AI deployment creates genuine competitive differentiation. This marks a notable shift from the 2023–2025 period, when simply embedding AI features was often sufficient to command acquirer interest.

Recent transactions illustrate how this thinking is dealmaking. LDC's sale of Building Cost Information Service was driven by its extensive proprietary construction data, while Graphite Capital's exit of Beacon showcased the integration of AI-assisted workflows into its life sciences platform.

2. Buyer Selectivity Is Reshaping Sale Processes

General partners are increasingly focused on identifying the right buyers early—engaging them before any formal process begins and equipping them with the information needed to build conviction. Bidders have grown reluctant to commit time and resources to broad auction processes without confidence that an asset merits pursuit.

Acquirers also want direct access to management teams to assess how they are responding to AI-driven disruption, whether through investment in new capabilities, protection of proprietary assets, or adaptation of growth strategies.

LDC's sale of Sedex Information Exchange exemplifies this approach. The process targeted a carefully selected group of buyers, supported by thorough preparation and early engagement. This strategy generated strong competitive tension while enabling the transaction to advance quickly through its later stages.

In an AI-driven market, buyers prioritize certainty. Early access to management teams has therefore become essential in helping acquirers build the confidence needed to proceed.

3. AI Is Redefining What Businesses Are Worth

Infrastructure services, engineering, and other asset-backed sectors have grown increasingly attractive to buyers, as they combine stable earnings with capabilities that are difficult to automate. Recent transactions involving companies such as Senior, GMC Group, and Ashcourt Group reflect this trend. The appeal of these sectors underscores a broader reordering of perceived value: businesses once viewed as lower-growth are now being reassessed for their insulation from AI disruption.

At the same time, high-quality software and data businesses continue to attract interest where they can demonstrate clear differentiation. Recent exits—including Geomatik's sale to Axcel and TradingHub's acquisition by Nordic Capital—show that buyers remain willing to pay for businesses with strong competitive positioning and a compelling AI proposition.

Conclusion: Relationships Drive Successful Outcomes

Navigating this market demands a relationship-led approach to dealmaking. Investec notes that it works with funds and portfolio businesses throughout their lifecycle, continually adapting how deals are prepared, marketed, and valued as the AI landscape evolves.

The firms achieving successful exits are not waiting for market conditions to improve. They are tailoring their strategies to today's reality—building credible AI investment cases, targeting the right buyers, and prioritizing certainty of execution. Ultimately, value lies in identifying the right outcome, not simply completing a transaction.