Carve-outs are set to dominate global mergers and acquisitions in 2026 as companies simplify portfolios amid geopolitical pressures and rapid AI-driven disruption, according to a report by Bloomberg citing the findings of KPMG’s Global M&A Outlook 2026.
The survey of 700 M&A decision-makers shows that 57% of corporates and 71% of private equity firms are open to or actively pursuing portfolio rationalisation this year.
Boards are focusing on core businesses, using carve-outs to reduce risk and streamline operations, while private equity is positioning itself as a natural buyer for these divested assets. The report highlights a notable US optimism gap, with 75% of US PE dealmakers expecting higher deal volumes compared with 57% of corporates, and 89% forecasting higher-quality opportunities versus 59% of corporates.
Technology, particularly AI, is accelerating carve-out decisions, shaping separation planning, valuation, and execution. Operational disentanglement, valuation complexity, and IT/data separation remain the primary execution challenges, though talent retention is increasingly recognised as critical. KPMG predicts the carve-out surge will feed future IPOs, with private equity acting as a bridge.
