Private Equity Rushes to Exit via IPO Boom, With Listings Hitting Highest Since 2021
Claire Weston
U.S. private-equity firms have taken 21 portfolio companies public so far this year — the most since 2021 — as a sluggish M&A market pushes IPOs from fallback option to primary exit channel, though lock-ups and price swings mean listing day is far from cash-out day.
Why are PE firms rushing companies to market this year?
The M&A market — where PE sells a company to another buyer — remains sluggish. Buyers are scarce and price gaps persist, leaving PE capital locked inside investments.
This means → IPOs have become the alternative liquidity valve: if public markets will take the deal, PE firms are pushing companies through.
Blackstone president Jonathan Gray labeled 2026 "the year of the IPO." Hot sectors driving listings include AI, aerospace, and defense.
Twenty-one IPOs — what does that number tell us?
As of August 5, 21 PE-backed companies have completed U.S. IPOs this year — above the 20 for all of 2025 and 16 for 2024.
In plain terms = just over half a year's count already tops last year's full tally. The pace has clearly accelerated.
Recent listings span consumer, apparel, and data centers — sandwich chain Jersey Mike's, fashion brand Reformation, and data-center firm Csquare all made the list.
Does going public mean cashing out?
Not even close. Underwriters typically require at least a six-month lock-up, and full sell-downs often take years.
Share-price swings add another layer of risk: Blackstone held Jersey Mike's for roughly 18 months before its NYSE debut, yet the stock fell 6% on day one.
This means → the IPO is only step one of the exit. How much PE ultimately recovers depends on where the stock trades afterward.
If IPOs are booming, will PE abandon M&A exits?
No. Debevoise & Plimpton partner Eric Juergens put it bluntly: "Where they can find a buyer, PE firms still prefer M&A."
The data backs him up. Since early 2022, public listings have accounted for only about 1% of all PE exits in the U.S. — a tiny share.
In plain terms = the IPO is a backup exit temporarily upgraded. M&A remains the default; it is just that the default path is blocked more often now.
What other exit tricks does PE have?
"Dual-track" processes: PE runs IPO prep and a private sale in parallel, sometimes using the IPO valuation to bid up the private-sale price — essentially forcing two paths to compete.
Madison Dearborn hired Jefferies in late 2023 to find a private buyer for defense contractor Aevex. The deal fell through; in April this year the firm listed Aevex at a $2 billion-plus valuation instead.
Other tools include continuation funds, secondary-market sales, and leveraged dividends — Brookfield-backed battery maker Clarios scrapped its planned U.S. IPO last year and paid shareholders via new debt instead.
Can this IPO wave last?
PwC U.S. PE head Josh Smigel framed the shift: IPOs are now "being considered more than ever before," though historically they have never been the first choice.
This reflects a structural change: PE has upgraded the IPO from "last resort" to "a standing tool in the kit" — but whether it stays usable depends on market volatility and investor sentiment.
Put simply = when the window is open, everyone rushes through. Once it closes, this exit lane narrows again.
Content is for reference only, not financial advice.