Morning all, Irien Joseph here with the Europe edition of the Wire from the London newsroom.
We begin with the utilities sector, featuring insights from EY’s Cord Stuemke and EY-Parthenon’s Robert Wienken on what makes Europe’s utilities landscape appealing to private equity and how long-term energy transition goals like decarbonization and electrification are driving PE engagement.
Rounding things off with our weekly roundup of deals, where the spotlight is on technology. PE Hub reported 18 tech deals across the US and Europe. We also have insights from Adams Street Partners’ Brian Dudley, who shares his 2026 M&A outlook for enterprise software.
Dynamic dealflow
Europe’s utilities sector has become a “compelling frontier” for private equity, propelled by strong momentum in low-carbon mobility, energy efficiency, intelligent grids and low-carbon fuels, Cord Stuemke, who is EY’s private equity industry leader in Europe West region, told me. EU net-zero goals and regulatory frameworks are reinforcing this trend, helping to de-risk and accelerate decarbonization investments, Stuemke said.
Momentum is clearly building. In 2024, the sector recorded 121 PE investments, a 30 percent year-on-year increase and the highest investment volume on record, Stuemke noted.
He outlined three main pillars underpinning the investment case. First, the ongoing shift towards decarbonization and electrification is reshaping the utilities value chain. This opens a “wide origination opportunity set across multiple segments and geographies that allows funds with deep networks to generate alpha,” he said.
Second, the most dynamic dealflow is emerging around low-carbon mobility, renewables and energy efficiency and intelligent grid. Private equity, he said, is “increasingly targeting software, services, and asset-light models that support scalable deployment of energy transition infrastructure across Europe’s most dynamic markets.”
Third, the energy transition’s catalytic effect on portfolio-wide value creation. “Decarbonization and electrification trends create opportunities for private equity to drive operational efficiencies, enhance ESG performance, and capture differentiated, alpha-generating returns across existing portfolio companies through cross-asset synergies,” he said.
Long-term energy transition goals now sit at the heart of PE strategy in European utilities, Robert Wienken, EY-Parthenon partner and private equity infrastructure leader, told PE Hub. “Decarbonization and electrification are reshaping capital allocation, with roughly 70 percent of PE deals targeting products, equipment and services that directly support the energy transition value chain, spanning solar trackers and wind sensors to EV charging and grid management technologies.”
Within that, transport electrification has been a strong driver, accounting for around 45 percent of disclosed deal value between 2020 and 2024, Wienken said. This shows how sector-specific transition goals create concentrated pockets of opportunity.
PE is also targeting energy efficiency, intelligent grid solutions and decarbonization technologies for hard-to-abate sectors, he said. Asset-light, technology-enabled models are favored for their scalability and enhanced returns without heavy capital requirements, he added.
“Low-carbon mobility and fuels dominated PE activity until 2024, particularly in EV charging, but uncertainty in the EV market caused a partial shift toward services and software solutions,” he said.
Meanwhile, energy efficiency, intelligent grid and decarbonization deals more than doubled year-on-year in 2024, while renewables held steady, Wienken added.
Investment patterns show that around 70 percent of deals target products and equipment, with a growing share moving into software- and services-related assets across renewables, EV infrastructure, and energy efficiency, he said.
Geographically, activity has been broad, with Germany, France, the Nordics and the UK standing out due to mature utilities infrastructure and strong policy support, Wienken said.
“The outlook for further deployment remains abundant, reflecting both market maturation and growing investor confidence in multi-asset strategies while highlighting sustained opportunity across these high-growth sub-sectors,” Wienken added.
AI adoption
Sticking with those asset-light investments favored by private equity. In this week’s deal roundup, the focus is on the technology sector as PE Hub reported 18 deals across the US and Europe.
That busy week came after a September where the TMT sector led in global deal activity, with 384 PE-backed transactions, according to a S&P Global Market Intelligence report.
That momentum could continue into 2026, as enterprise software M&A is expected to be shaped by widespread AI adoption, according to Adams Street Partners’ partner Brian Dudley. “Growth will come from companies that can embed AI into workflows to deliver tangible productivity gains and ROI, not just incremental features.”
The key driver will be whether enterprises move from experimentation to full-scale deployment of AI systems, creating broad-based spend reallocation toward AI-native tools, said Dudley. “We’re also seeing early signals of platform consolidation, as companies prefer integrated solutions over point tools – a dynamic that could spark increased M&A activity in the sector.”
For growth investors, this sets the stage for category leaders to pull away and establish durable moats, Dudley added.
Below are the tech deals from this week:
Schedule note: In observance of Indigenous Peoples’ Day in the US on Monday, October 13, there will be one combined US/Europe PE Hub Wire. Regular publication of the US and Europe Wires will resume on Tuesday, October 14.
That wraps up today’s coverage. John R Fischer will be covering the US edition this morning in New York and Nina Lindholm will return on Monday with the combined edition of the Wire.
Warmly,
Irien