EY’s study reveals importance of preparing for a vital sale 

EY has published this year’s Private Equity Exit Readiness study, offering deep insights into how private equity (PE) firms are preparing for exits in today’s uncertain economic environment. 

The study, based on interviews with 100 senior private equity professionals – including 47 per cent vice president-level dealmakers, 29 per cent managing directors, and 24 per cent operating partners – was conducted between March and April 2025 and sheds light on a critical topic: how firms can optimise returns despite extended holding periods and shifting market dynamics.

One of the headline findings is that 78 per cent of private equity firms reported holding assets beyond their typical investment horizon of five or more years. This is a significant shift, as it underscores how volatile market conditions of the past few years have prompted firms to delay exits, waiting for a more favourable environment to materialise.

Despite these extended hold periods, most firms surveyed remain optimistic that the market will settle in the near future, and many are actively preparing for exits now to ensure readiness when conditions do improve.

At the core of this preparation is a renewed focus on exit readiness activities, particularly data preparation and KPI tracking – factors increasingly seen as crucial for maximising valuation and ensuring smoother transaction processes.

The insights gained from these private equity firms are not just relevant to the PE community but offer valuable lessons for privately-owned businesses as well. The challenges they face during exits – especially around data – are often shared.

According to the report, the most common complaint among PE professionals was the lack of a robust set of data and KPIs. Inadequate data readiness can slow down the exit process, introduce valuation risk, and create uncertainty for buyers.

However, when firms undertake comprehensive data cleansing and integration, they position themselves far more effectively for a successful exit.

EY outlines several benefits of data readiness activities that can drive higher exit valuations:

• Crafting a compelling equity story supported by consistent KPIs and granular data.
• Tracking value creation initiatives in detail, including their contribution to EBITDA, and identifying “quick wins” in the 12 months prior to exit.
• Streamlining the due diligence process, reducing surprises and bidder challenges.
• Enhancing transparency and buyer confidence, especially critical in today’s competitive deal environment.
• This emphasis on readiness is mirrored in EY Scotland’s recent private equity transactions, where there has been a noticeable uptick in PE involvement. Several notable deals in the past year underscore the growing importance of exit planning and data clarity:
• EY led the sale of Train’d Up, a privately-owned business, to Chiltern Capital.
• Moss Engineering was carved out of Graphite Capital-backed ICR Integrity Ltd and sold to Denholm Energy, a privately-owned energy firm.
• EY advised Patron Capital and Sixth Street in their acquisition of Cala Homes.
• EY led the sale of Veracity UK, a privately-owned company, to Longacre, a PE firm.
• One of the earlier notable PE transactions was the 2022 sale of eServ to Vespa Capital.

These deals highlight EY Scotland’s deep involvement in the private equity space and its commitment to guiding both sponsors and founders through complex exits.

As markets continue to evolve, EY’s Private Equity Exit Readiness 2025 study reinforces a simple but powerful message: preparation is critical, and data is the foundation of a successful exit strategy.

Whether you are a fund manager navigating a delayed exit, or a privately-owned business eyeing a potential transaction, the importance of early, disciplined readiness – especially around data – cannot be overstated.