As the number of carve-outs continues to grow, deliverability has become the most important factor in winning them.

The eighth annual Carve-Out Survey from AURELIUS indicates that corporate carve-outs are expected to continue to rise in 2026, with nearly 80% of respondents predicting an increase in the number of global corporates looking to divest non-core businesses, in line with our Survey a year ago.

“Another challenging year for businesses as governments in the UK and US have made frequent fiscal changes, catalysing corporates to consider their priorities for the time ahead, with many opting to sharpen their focus and divest non-core areas,” says Tristan Nagler, Partner at AURELIUS Investment Advisory.

Refocusing on core operations remains the dominant driver of corporate divestment plans for 2026, cited by 73% of respondents (up slightly from 70% last year). Disposing of unattractive non-core assets is again the second-ranked motivator. By contrast, deleveraging has slipped sharply down the agenda: only 5% cite debt reduction this year, versus 9% last year and 52% two years ago. Decisions to divest may be accelerated by global trade tensions, with 72% of respondents feeling rising tariffs and protectionist policies are affecting corporate decisions to divest non-core businesses in 2026.

Winning carve-out opportunities will be down to certainty of execution: In today’s tighter and costlier financing environment, certainty of funding and execution is outweighing headline valuations. Deliverability tops the list of seller priorities, with 59% of respondents calling it the key differentiator. Price ranks first for just a quarter, down from a third last year.

AI is playing an increasing role in identification and diligence processes. In a marked shift that highlights the growing importance of AI, nearly three-quarters of respondents (73%) say AI is becoming an important part of investment identification and due diligence processes, up from just a quarter (24%) a year ago. However, a quarter disagree with this sentiment, and no respondents were on the fence – up from nearly two-thirds (62%) last year.

A value strategy remains the best investment approach to carve-outs according to over three-quarters of respondents (77%), with growth a distant second (17%). The responses mirror our last survey and likely reflect the inherent complexity of carve-outs: significant resource and experience is required to untangle legacy systems and create new infrastructure. Operational independence typically takes at least a year of graft, and only after that can growth be pursued – meaning quick wins are elusive.

ESG is being de-prioritised. There has been a more than doubling of respondents agreeing that ESG considerations have become less important to carve-outs, from under a third in our last Survey (32%) to over three-quarters (77%) this time. While sustainability is understandably relevant for most businesses, a broader ESG framework may not make sense if the aims are not material to wider stakeholder concerns. It may also be the European Commission’s introduction in early 2025 of a “Simplification Omnibus” that has seen some businesses put ESG on the back burner for now.

The number of buyers pursuing corporate carve-outs is on the rise, according to 77% of respondents – up from 59% a year prior. The shift likely reflects a need to widen origination in a market where compressed multiples and vendor expectations are limiting deal flow, as well as new entrants attracted by the strong returns available to those who can manage carve-out complexity. The net effect could be upward pressure on pricing for assets that do reach the market.

There continues to be a value gap between buyers and sellers – but the market is divided on its direction. While 57% agree that the value gap between buyers and sellers has narrowed, another 43% disagree. The responses show a divergence from our last Survey, when only 24% disagreed.

Over three-quarters of respondents (80%) feel the PE industry is ripe for consolidation, up from 62% a year ago and highlighting the difficult backdrop caused by permavolatility since the onset of the Covid pandemic. Prolonged uncertainty has caused a bifurcation which may be widening, with some firms raising record sums swiftly and others slashing targets during protracted fundraises – or even moving to deal-by-deal. However, real consolidation will be slow as the life of a fund is long and getting longer with continuation vehicles as an example.

The industry needs to work on its PR. Debate about private equity’s “licence to operate” has rumbled on since buyouts ballooned in the 2000s. Nearly two-thirds of respondents (63%) say the industry must do more to improve its public image, while 37% disagree. What feels like a crescendo in private equity-backed failures – largely off the back of high leverage – is doing the industry no favours.

“The ongoing uncertainty is extremely challenging for businesses – but can offer real opportunity for those able to simplify complexity. The potential offered by operationally transforming underperforming business units into independent entities is increasingly understood by international institutional investors – our latest fundraise made that very clear,” states Tristan.

The AURELIUS Carve-Out Survey was undertaken in Q4 2025 and canvassed the opinion of 140 senior professionals in the advisory, private equity and corporate space (c. 80% Partner or MD level).