Secondaries: Capitalising on the wave

Regional markets:  Europe, Asia & US

The European secondaries market was active in 2025. Portfolios are performing well, and LPs are actively managing exposure – reducing US concentration while expanding into Asia. European LPs are increasingly proactive in the secondaries market, often willing to accept discounts to NAV to accelerate distributions. This pragmatism, combined with robust deal flow, positions Europe as a key growth engine for secondaries next year.

Asia’s secondaries story in 2025 was shaped by geopolitics and structural shifts. Chinese sellers have been offloading US portfolios, driving significant transaction volumes. Pan-Asian funds with heavy China exposure face fundraising challenges, making GP-leds an attractive tool to maintain AUM and stabilise operations.

The US secondaries market is poised for a strong 2026, underpinned by several structural tailwinds. Tariff uncertainty is expected to remain a key macro driver, continuing to put pressure on portfolio company valuations and dampened traditional exit activity. This environment is projected to accelerate GP-led volume in the US as sponsors seek to hold assets until conditions stabilise.

The LP-led market is projected to be active in 2026. Of the 12,000 US companies held in funds, 8,000 are four years or older. In 2024, only 1,500 companies exited¹, leaving a significant gap between aging portfolios and realised distributions. This backlog, coupled with the ongoing stalled exit environment, will push more LPs toward the secondaries market as delayed distributions persist.