The private equity industry is spooked — and it’s not just because of Halloween. Private equity is finding it increasingly difficult to raise fresh capital, leading the CEO of Swedish PE firm EQT, Per Franzén, to predict that some 80% of all private equity firms could turn into zombie firms by 2035 in comments to the Financial Times.

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Forget witches and ghosts, zombie firms are a more formidable spectre haunting the industry, which happens when an investment firm can no longer raise money for new funds and remains operational to manage the companies and investments it already has. Like the undead, these firms are technically alive, but are dead insofar as they no longer seal new acquisitions or raise fresh funds while they run down their existing investments.

It’s not just a nightmare on Wall Street, but a global issue, with only a third of the 15k or so PE firms having raised funds in the last seven years, according to Franzén. Of these 5k firms with some recent fundraising success, Franzén sees less than half of them carrying on this success in the next 5-10 years. But there’s good news for the largest firms with established global footprint, with 50 to 100 such firms expected to rake in 90% of all fresh funds in the next fundraising period.

REMEMBER- Hopes for a rebound of the sector at the start of the year began to fall apartby early April, when a fresh round of US tariffs sent markets wobbling after a strong start to the year. Transaction value in April fell 24% below the 1Q average, and dealcount dropped 22%, according to Bain and Company’s Private Equity Midyear Report 2025. Now, more than 18k funds are chasing USD 3.3 tn in capital — or USD 3 of demand for every USD 1 available — according to the report.

MARKETS THIS MORNING-

Asian markets are in the green this morning, with the Kospi leading gains (+2.4%) The Nikkei (+2.1%), Hang Seng (+0.5%), and Shanghai Composite (+0.1%) are looking at more moderate gains.

TASI

11,536

-1.0% (YTD: -4.2%)

MSCI Tadawul 30

1,498

-1.2% (YTD: -0.7%)

NomuC

24,944

-0.3% (YTD: -20.8%)

USD : SAR (SAMA)

USD 3.75 Sell

USD 3.75 Buy

Interest rates

4.5% repo

4.0% reverse repo

EGX30

38,083

-0.5% (YTD: +28.1%)

ADX

10,100

-1.1% (YTD: +7.2%)

DFM

6,059

-0.8% (YTD: +17.5%)

S&P 500

6,840

+0.3% (YTD: +16.3%)

FTSE 100

9,717

-0.4% (YTD: +18.9%)

Euro Stoxx 50

5,662

-0.7% (YTD: +15.7%)

Brent crude

USD 65.03

+0.4%

Natural gas (Nymex)

USD 4.10

-0.5%

Gold

USD 4,002

+0.2%

BTC

USD 110,567

+0.5% (YTD: +18.2%)

Sukuk/bond market index

916.09

-0.3% (YTD: +1.6%)

S&P MENA bond & sukuk

152.05

-0.2% (YTD: +8.7%)

VIX (Fear gauge)

17.44

+3.1% (YTD: +0.5%)

THE CLOSING BELL: TADAWUL-

The TASI fell 1% yesterday on turnover of SAR 4.4 bn. The index is down 4.2% YTD.

In the green: Senaat (+10.0%), ACIG (+6.0%) and UCIC (+5.1%).

In the red: Naseej (-7.6%), Americana (-6.8%) and Saco (-6.0%).

THE CLOSING BELL: NOMU-

The NomuC fell 0.3%yesterday on turnover of SAR 12.2 mn. The index is down 20.8% YTD.

In the green: Al Muneef (+9.7%), Aqaseem (+7.7%) and TMC (+6.7%).

In the red: HKC (-10.0%), NGDC (-6.0%) and Mobi Industry (-5.6%).

CORPORATE ACTIONS-

Mohammed Hadi AlRasheed received the Capital Market Authority’s approval for a SAR 60 mn capital boost to SAR 180 mn, via issuing one bonus share for every two existing ones, the authority said in a statement yesterday. The company will fund the increase via its retained earnings, increasing the company’s share to 18 mn. Shareholder and regulatory approvals are still needed for the hike.

Academy of Learning Company received the greenlight from the Capital Market Authority to raise its capital by SAR 45 mn to SAR 135 mn, a move that will be funded by retained earnings through issuing one bonus share for every two existing ones, the authority said in a statement yesterday. The move is still pending regulatory and shareholder approval.

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