Private equity interest in legal services remains robust, with M&A activity trudging steadily through the first quarter of 2026. However, deal execution has tempered significantly, according to Arrowpoint Advisory's latest market update. Ollie Chambers, a director at the investment bank, identified a clear culprit reshaping the sector.

Artificial intelligence is disrupting legal services at a pace that complicates dealmaking. Buyers now face heightened uncertainty when valuing target companies, as AI-driven changes to legal workflows can rapidly alter business models and revenue streams. This technological turbulence has made investors far more cautious during due diligence and contract negotiations.

Despite the execution challenges, PE firms continue hunting for opportunities in the space. Separately, IK Partners agreed to acquire Selatek, a technical installation business, from Amplio Private Equity. Meanwhile, Bain Capital Insurance-backed Aptia expanded its platform by adding the Pension Decision Service.