Key Takeaways
- • Continuation vehicles (CVs) accounted for 19% of sponsor-backed exits as of June 2025, up sharply from 13% in 2024 and 12% in 2023, signaling accelerating adoption of this exit strategy among private equity firms.
- • The trend reflects a structural shift in PE exit strategies, with some general partners viewing CVs as more than temporary measures despite industry skepticism about their permanence as a solution.
- • CVs enable PE firms to extend portfolio company holding periods while providing existing limited partners with liquidity options—either to cash out entirely or roll equity into the continuation vehicle.
- • Nearly 45% of companies within single-asset CVs demonstrated implied transaction enterprise values exceeding $2 billion in 2024, indicating substantial asset sizes being structured through continuation vehicles.
Summary
Continuation vehicles have emerged as a significant structural component of private equity exit strategies, capturing an increasing share of sponsor-backed deal activity. According to KPMG research, CVs represented 19% of all sponsor-backed exits by June 2025, marking a notable acceleration from 13% in 2024 and 12% in 2023. This three-year upward trajectory indicates a fundamental shift in how general partners are approaching portfolio exits and LP liquidity management.
The rising prevalence of CVs reflects the practical advantages they offer in a complex exit environment. These vehicles enable private equity sponsors to maintain control of portfolio companies beyond traditional fund lifecycles while simultaneously providing limited partners with multiple paths forward—either full liquidity through a complete exit or continued exposure through equity rollover into the new continuation structure. This flexibility has become increasingly attractive as PE sponsors navigate extended holding periods, challenging IPO windows, and selective M&A markets.
Industry perception of continuation vehicles has evolved alongside their increased deployment. While some GPs historically viewed CVs as temporary expedients or stopgap measures during unfavorable exit windows, the data suggests a more permanent integration into PE operating and exit playbooks. The consistent year-over-year growth indicates that CVs are now embedded strategic tools rather than cyclical responses to market conditions.
The scale of assets flowing through single-asset CV structures underscores their material significance. Nearly 45% of companies within single-asset CVs carried implied transaction enterprise values exceeding $2 billion in 2024, demonstrating that major portfolio holdings are being actively structured through continuation vehicles. This concentration at the larger end of the asset spectrum indicates that established, mature portfolio companies—not distressed or underperforming assets—are primary candidates for CV structuring.
For institutional investors and fund managers, the 19% exit share signals a meaningful rebalancing of LP return profiles and exit timing. As CVs continue to capture larger shares of sponsor-backed activities, LPs must refine their own succession planning and liquidity strategies to accommodate extended commitment periods and multi-tranched return streams characteristic of continuation vehicle arrangements.
The rising prevalence of CVs reflects the practical advantages they offer in a complex exit environment. These vehicles enable private equity sponsors to maintain control of portfolio companies beyond traditional fund lifecycles while simultaneously providing limited partners with multiple paths forward—either full liquidity through a complete exit or continued exposure through equity rollover into the new continuation structure. This flexibility has become increasingly attractive as PE sponsors navigate extended holding periods, challenging IPO windows, and selective M&A markets.
Industry perception of continuation vehicles has evolved alongside their increased deployment. While some GPs historically viewed CVs as temporary expedients or stopgap measures during unfavorable exit windows, the data suggests a more permanent integration into PE operating and exit playbooks. The consistent year-over-year growth indicates that CVs are now embedded strategic tools rather than cyclical responses to market conditions.
The scale of assets flowing through single-asset CV structures underscores their material significance. Nearly 45% of companies within single-asset CVs carried implied transaction enterprise values exceeding $2 billion in 2024, demonstrating that major portfolio holdings are being actively structured through continuation vehicles. This concentration at the larger end of the asset spectrum indicates that established, mature portfolio companies—not distressed or underperforming assets—are primary candidates for CV structuring.
For institutional investors and fund managers, the 19% exit share signals a meaningful rebalancing of LP return profiles and exit timing. As CVs continue to capture larger shares of sponsor-backed activities, LPs must refine their own succession planning and liquidity strategies to accommodate extended commitment periods and multi-tranched return streams characteristic of continuation vehicle arrangements.
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