Part 2 - Key Trends Shaping UK Private Equity Investments

The Outlook for Q4 and 2027

Tony Goldsby, Director, Lord Interim

Lord Interim Management partner with many of the UK’s marketing leading and highly respected SME and mid-market private equity portfolio investment companies. We look ahead at what 2027 may bring in a series of articles over the next few weeks…

In 2027, private equity firms, owners and management teams will need to show they can improve businesses in practical ways.

• Better pricing models

• Procurement savings and supply chain risk assessment

• Sales effectiveness and Digital tools that improve efficiency

• Working capital control

• Talent retention and upskilling the team below the C-suite

PE firms are bringing operating specialists into the process earlier to assess what can be improved before deal completion, rather than waiting for the first board meeting. Management teams should expect more detailed questions during due diligence.

Technology and realistic, secure AI adoption are shaping discussions. Investors will not only ask how revenue can grow, but they will also need to know who will deliver that growth, what systems are being used and will be needed, and how fast the ‘go to market’ growth plan can be tested.

Technology will stay high on the agenda, but the focus is shifting. Claims about the use of artificial intelligence will need to be supported with clear, measurable user cases that are resilient due to the increase in AI threats.

The best UK technology deals in 2027 will be services companies with sticky customers and clear renewal patterns. This could include specialist software, data, cyber security, and tech-enabled support companies whose niche products and solutions can transfer across multiple sectors.

Sector choices will reflect resilience and policy change. In the UK, several areas attract attention.

·        Healthcare and specialist care services – an ageing population demands new product development and support services to provide greater independence.

·        Business services - these markets are fragmented, which creates scope for buy-and-build strategies.

·        Energy transition and infrastructure services - energy efficiency, heat networks, metering, maintenance, and specialist engineering technology.

·        Defence and security supply chains - geopolitical risk has made defence, cyber security, and critical infrastructure protection more prominent.

·        Carve-outs will create opportunities - larger companies continue to review their portfolios.

The UK still offers deep talent, mature capital markets, world-class sectors, and many mid-market businesses with room to grow.

The main takeaway is simple: 2027 will reward the buyer with the clearest plan, the strongest due diligence, and the patience to build value after the deal closes.

Lord Interim works with clients, delivering subject matter and fractional Interim expertise to support private equity portfolio companies in their market preparation.

To find out more about Lord’s range of Value Creation Diagnostic and Interim management support, call Tony Goldsby; London Office on 020 7692 8968 or Birmingham Office on 0121 445 7900 – or email tgoldsby@lord.co.uk