Good morning, {{First Name}}! Healthcare dealmaking is heading toward $281B, but sponsors are paying less and putting up more equity. Meanwhile, PE’s distribution problem is catching up with recent vintages, and a $100+ oil shock is putting the Fed back on offense.

Plus, we look at who really owns the customer in channel-heavy businesses—and where AI is starting to reshape the PE investment process.

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DATA DIVE

Healthcare dealmaking is reopening, but capital access is becoming more selective. Americas healthcare transaction value is projected to reach $281B in 2026, up roughly 30% from $216B in 2025 and nearly 80% from the $156B trough in 2024.

The more important signal sits underneath the headline. Private equity entry multiples fell from 15.3x EBITDA in 2025 to 10.7x in 2026, while strategic buyers moved the other direction, reaching 13.4x. Higher financing costs are forcing sponsors to rely less on multiple expansion and more on EBITDA growth, deleveraging, and operational execution.

Private credit is keeping transactions financeable, but lenders are not reopening the leverage spigot. New-issue leverage remained tightly clustered around 4.7x to 4.9x EBITDA, while sponsors contributed roughly 59% of LBO financing in Q1.

For PE investors, the implication is clear: healthcare is not entering another leverage-driven boom. The next cycle favors assets with durable cash conversion, reimbursement visibility, and credible operational upside. Capital is available, but increasingly only for businesses that can prove they deserve it.

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TREND TO WATCH

Private equity’s exit drought is starting to show up where LPs feel it most: distributions. Five years after inception, DPI has historically landed around 32%, but recent vintages are falling well short. The 2020 vintage sits at 22%, while 2021 is at just 14% after four years—below the 18% long-term average.

The timing isn’t ideal. Many assets acquired during the 2021–2022 valuation peak are now entering extended holding periods, as higher rates and tougher exit markets make it harder for sponsors to realize investments at attractive prices. UBS also flags another wrinkle: AI disruption could pressure the terminal value of certain portfolio companies, even where near-term earnings remain resilient.

For LPs, the question is shifting from when will exits recover? to what will these assets ultimately be worth when they do? Longer holds can buy time—but they can’t guarantee the original underwriting still works.

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EDITORIAL CONTENT BROUGHT TO YOU BY CAPLINK X PE150

AI in private equity is quickly shifting from experimentation to infrastructure. Our latest market map tracks the companies building tools across sourcing, diligence, knowledge search, financial analysis, and portfolio monitoring.

The bigger story is not the number of vendors. It is how much of the investment process is becoming software enabled, creating a new question for firms: where can AI produce a genuine information or execution advantage?

Explore the full PE150 AI Market Map in Excel for company level details, positioning, and additional research.

DILIGENCE CORNER BY 150 DILIGENCE

Channel exposure can look like diversification until you ask who actually controls the relationship.

Rubrik disclosed that its three largest channel partners generated roughly 73% of fiscal 2025 revenue. Tenable went even further: 94% of 2025 revenue came through channel partners, with Ingram Micro alone accounting for 32%.

That does not automatically make either model unattractive. Partners can expand geographic reach, lower customer acquisition costs, and accelerate distribution. But for investors, the diligence question is whether the channel is simply fulfilling demand or actually controlling it.

A buyer should understand who owns the customer relationship, who influences pricing, how easily partners can switch vendors, whether contracts require minimum purchases, and what happens to growth if a major distributor deprioritizes the product.

The key distinction: channel concentration is manageable when the company owns demand. It becomes dangerous when the intermediary owns it. (More)

MACROVIEW

August inflation just made the Fed’s job harder. Headline CPI rose 0.4% for the month and 3.4% year over year, while core inflation increased 0.3%, slightly above expectations.

The real problem is energy. Energy prices are now 16.3% higher than a year ago, gasoline is up 27.4%, and fuel oil has surged 52%. With crude back above $100 and the Iran conflict lasting longer than initially expected, markets are starting to treat the shock as persistent rather than temporary.

That shift is already reaching monetary policy. The probability of a Fed hike next week jumped from roughly 70% before CPI to around 90% afterward, with another increase later this year now entering the conversation.

The 1970s comparison is imperfect, but the sequence is familiar: energy shock, broader price transmission, then tighter policy.

For private equity, the risk is straightforward. Higher operating costs and higher financing costs could arrive together, pressuring margins, refinancing assumptions, and exit multiples at the same time. (More)