2025 U.S. VC Deal Value Surged to $339.4 Billion, but Concerns Linger

The U.S. venture capital market recorded $339.4 billion in deal value for 2025, according to PitchBook. This marked a significant increase compared to previous years. However, concerns persist over the fairness and transparency of certain transactions. The surge in deal value reflects ongoing private equity activity in multiple sectors.

The private equity landscape saw a notable conflict involving Ascent Resources. A dispute emerged between investors, including the Abu Dhabi Investment Council, and Energy & Minerals Group (EMG). Kirkland & Ellis, representing the Ascent board, was accused of conflict of interest. Mason Capital Management expressed concerns over the law firm's dual role.

The dispute led to legal action, with the Abu Dhabi fund filing a lawsuit to block a continuation fund proposal by EMG. The two sides have agreed to pursue arbitration, delaying the fund's closure until resolution. Meanwhile, other bids for Ascent have surfaced, including a $6 billion proposal from Kimmeridge Energy Management.

TRM Equity recently completed the acquisition of production facilities from Grede Holdings LLC. The assets include the Browntown Foundry and Iron Mountain Foundry, located in Wisconsin and Michigan, respectively. The acquisition expands TRM's capabilities in the foundry industry.

Why Did This Happen?

The Ascent Resources dispute highlights concerns over conflict of interest in private equity transactions. Critics argue that the involvement of conflicted legal counsel undermines the board's ability to act impartially. Mason Capital Management emphasized the need for a special committee and independent financial advice to evaluate alternatives.

The broader trend of continuation funds reflects a strategy to extend investments in long-held companies. However, this approach can raise ethical questions when private equity firms are involved on both sides of the transaction according to analysis.

How Did Markets React?

Despite the legal challenges, the overall venture capital market remains robust. The $620 million buyout of Denny's by private equity firms TriArtisan Capital Advisors, Treville Capital, and Yadav Enterprises was approved by shareholders. This move positions Denny's as a private entity.

In the manufacturing sector, TRM Equity's acquisition of Grede Holdings' foundries signals continued private equity interest in industrial assets. The firm aims to enhance operational efficiency and deliver value to customers.

What Are Analysts Watching Next?

Analysts are closely monitoring the resolution of the Ascent Resources dispute. The arbitration process and potential corrective actions could set a precedent for similar cases in the private equity sector.

Meanwhile, the launch of Aquisor, a European M&A buy-side advisory firm, highlights the growing demand for specialized deal origination services. The firm aims to provide high-quality acquisition opportunities for private equity clients.

The Alta Copper transaction with Fortescue remains under scrutiny. The company has yet to secure the necessary agreements and regulatory approvals to resume drilling activities. An independent valuation has been conducted, but the outcome of the transaction remains uncertain.