EQT Capitalizes on Market Volatility
Private equity firm EQT views recent volatility in public technology markets, driven by concerns over artificial intelligence disruption, as an opportunity to invest in discounted software assets, according to Private Equity Wire. Per Franzen, EQT’s chief executive, stated that the current environment may support selective dealmaking in software for businesses well positioned to use AI to improve efficiency, expand margins, and reinvest cost savings into growth. EQT manages around €142bn in assets, with software accounting for approximately 14% of its fee-related assets under management in private capital.
EQT’s Approach to Investments
Franzen noted that EQT remains disciplined in avoiding over-concentration in any single sector, as market participants are becoming better at distinguishing between companies likely to benefit from AI and those more exposed to disruption. He suggested that over the coming quarters, dislocations in valuations could offer opportunities to acquire high-quality assets at more appealing prices. Investor concerns have been building around private capital exposure to software businesses, particularly following advances in AI tools that are seen as potentially disruptive to industries such as financial research and real estate services, according to the report.
Pressures on Buyout Firms and EQT’s Performance
These pressures are most visible among buyout firms that increased their exposure to technology during the previous dealmaking cycle. EQT highlighted strong performance across its technology portfolio, with mid-teens revenue growth and operating profit increases of 20–30% last year, driven by holdings such as industrial software group IFS. As artificial intelligence continues to influence global markets—a widely recognized trend—this positions EQT to navigate ongoing disruptions effectively, according to Private Equity Wire.
EQT’s Market Outlook
The firm emphasized that the AI-driven environment could create attractive entry points for new investments, particularly in software, while maintaining a balanced approach to sector exposure. This aligns with broader market dynamics where valuation adjustments are occurring due to technological shifts.
