Amidst a backdrop of soaring energy costs and geopolitical instability, private equity firm EQT anticipates investors will increasingly seek firms with proven track records. According to EQT CEO Christian Sinding, the current volatile market creates both challenges and opportunities for firms positioned to deliver consistent performance. EQT, established in 2020 with an Australian presence, manages approximately €232 billion in assets across two business segments – Private Capital and Infrastructure. The firm is distinguished by the Wallenberg family’s control and a strong emphasis on environmental, social, and governance (ESG) factors.
EQT views industry consolidation as inevitable, highlighting the importance of scale. They anticipate a rise in “zombie funds” struggling to raise capital, creating opportunities for stronger players to acquire assets. While some private credit providers face scrutiny, EQT, having sold its credit business in 2020, remains cautious, believing some players have taken on excessive risk. Sinding does not foresee systemic risk, noting ample liquidity and the potential for banks to step in.
Despite market uncertainty, EQT sees potential in public-to-private transactions and corporate carve-outs. The firm is particularly enthusiastic about artificial intelligence, investing in both AI-native businesses and leveraging the technology to enhance its existing assets. Sinding dismisses concerns about an AI bubble, emphasising the significant demand for AI compute and viewing it as a generational investment opportunity.
EQT remains committed to the Australian market, where it has already invested $13 billion across various companies and assets. While acknowledging some unsuccessful bids, Sinding views the Australian capital market as mature and well-functioning. EQT aims to bring more of its companies to public investors in Australia, highlighting its strong IPO track record.
