Private equity firms are adapting to a challenging exit environment by pursuing partial sales and extending hold periods, according to West Monroe partner Peter Kahn. The consulting firm reports that seven years is now the new normal for ownership duration, up from the previous five-year average. Kahn attributes the shift to mismatched valuations and AI-related concerns that are complicating traditional exit strategies.

West Monroe has observed increased creativity in exits, with companies splitting assets and selling only portions of their businesses rather than complete divestitures. The firm also notes a significant rise in sell-side preparation, with clients now beginning preparation 18 months before potential exits compared to the previous three-month timeline. Healthcare technology and residential services sectors are showing particular activity.

In related deal news, Advent-backed Cobham Ultra has agreed to sell its Ultra Cyber division to Airbus Defence and Space, while Bridgepoint-backed PEI Group has acquired Scientific Infra & Private Assets, a benchmark provider serving over $1 trillion in AUM. Freshstream has also announced leadership promotions and new hires across its investment teams.