The private equity playbook: Navigating growth in an age of uncertainty
By Stephen Sieh
Private equity in Asia-Pacific entered 2025 expecting momentum. Instead, it encountered a year defined by volatility, policy shifts and slower decision-making. Uncertainty, however, did not freeze the market for long. By the second half of the year, capital deployment resumed, but with a different playbook — smaller deal sizes, more defensive sector choices and a sharper focus on operational value creation rather than pure financial engineering.
Deloitte’s 2026 Asia-Pacific Private Equity Almanac discusses this shift, which is especially relevant in the Philippines where investors seek selective, midmarket opportunities linked to domestic demand, infrastructure and modernization.
Uncertainty is the operating environment
The defining theme of 2025 was not any single event, but the sustained, corrosive effect of not knowing. More than the tariffs announced by the United States in April 2025, the constant revision of proposals, shifting deadlines and unpredictable policy announcements froze investment committees across the region.
The heightened macro and geopolitical uncertainty that ultimately led to volatility around interest rates, financing costs and growth outlooks complicated forecast visibility, making valuation alignment harder to achieve. As a result, the Asia-Pacific private equity deal value fell 37 percent quarter-on-quarter in Q2 2025, closing the full year at US$127.3B, down 14 percent from 2024.
In response, general partners decisively shifted away from large, headline-grabbing transactions that attract regulatory scrutiny. The share of deal value from transactions above US$1B fell from 59 percent in 2024 to 46 percent in 2025.
Smaller companies, with their stronger domestic focus and less exposure to trade policy swings, became the preferred hunting ground. Bolt-on acquisitions supporting existing portfolio companies were particularly attractive, offering a lower equity commitment in industries general partners already understood well.
The midmarket story in the Philippines
Across Asia-Pacific, investors are leaning into midmarket deals as a defensive strategy, with digital infrastructure as a highly active sector, together with health care, consumer services, and logistics.
The Philippines maps naturally onto this pivot. Its private equity opportunity lies in scalable, mid-sized businesses across consumer services, healthcare, logistics and digital connectivity — companies tied to repeat-use demand, operational scaling and infrastructure gaps still waiting to be filled.
What makes this opportunity distinctive is the country’s typical business landscape: family-controlled firms that are underleveraged and operationally underdeveloped relative to their potential, yet increasingly in need of professional management as succession looms. Regionally, the mid-market shift reflects risk management; locally, it represents untapped growth.
Digital infrastructure is compelling. As a digital economy powerhouse, the Philippines sees rising demand for cloud capacity, data connectivity and AI-ready systems. Health care remains highly fragmented, offering significant room for platform-building across hospital networks, diagnostics and specialty care.
The consumer sector rounds out the picture: a young, urban population with rising household incomes provides a durable domestic growth story. These businesses with recurring domestic revenues are defensible in uncertainty and scalable under the right ownership. How that value gets created, however, is the more instructive part of the story.
From value creation to exit optionality
Private equity firms are no longer relying as heavily on market growth or multiple expansion to generate returns. Instead, they are placing greater emphasis on improving operations, bringing in professional talent, strengthening governance and using technology more deliberately across portfolio companies.
As value creation strategies across Asia-Pacific focus on institutionalization and operational scale, exit planning has become a natural extension of this agenda. In building more structured, scalable and well-governed businesses, private equity firms are effectively positioning their portfolio companies to meet the acquisition criteria of large corporates.
Against this backdrop, corporates have been acquiring private equity-backed businesses as acts of deliberate portfolio optimization to accelerate growth or build capabilities they could not develop organically. Corporate buyers now account for 55 percent of all private equity exits across Asia-Pacific, up from 32 percent in 2020.
Meanwhile, initial public offering (IPO) activities in the Asia-Pacific were heavily focused in developed markets, with limited reopening in Southeast Asia. Nevertheless, the period of reduced IPO activity creates a window for general partners to build earnings visibility and institutionalize their portfolio companies.
Aside from IPOs and trade sales, continuation vehicles, fund-to-fund trades and minority stake sales to sovereign wealth funds also provide additional liquidity pathways that are being used with increasing frequency across the region.
The Philippine private equity story is defined by resilience and disciplined execution, with mid-market opportunities offering both sectoral growth and structural transformation. In an era of heightened uncertainty, investors may favor companies that combine operational excellence with durable demand. The playbook emerging across Asia-Pacific is one the Philippines is well positioned to adopt, and the window to act on it is open.
Stephen Sieh is the Strategy, Risk and Transactions Leader at Deloitte Philippines, a member firm of the Deloitte network.
