Good morning,
We are only a few days into 2026 and already the maxim that the only certainty in life is uncertainty has been reinforced. Whilst we can’t precisely forecast the future, we remain focused on building a portfolio which can grow in a volatile and unpredictable environment.
Encouragingly, private company operating performance remains robust (see here for more detail) and credit conditions are benign, with interest rates expected to reduce and credit spreads remaining tight. These are encouraging signals for transaction activity which is supportive for managers seeking to invest in profitable, cash-generative companies. Set against this, we note declining consumer confidence in both Europe and the US, some elevated valuations compared to historical averages and exit levels which remain low relative to long-term trends.
We believe that in this environment, manager selection, active portfolio construction and balance sheet discipline become even more critical. Certain managers are generating attractive returns and liquidity, particularly those with strong origination capabilities focused on profitable, cash-generative businesses. Others are struggling. We anticipate that this wider dispersion of returns within private equity will become increasingly evident in the coming years.
We have three core areas of focus:
- Continuing to partner with managers who have strong track records through cycles, demonstrate operational expertise and which are strongly aligned with their investors
- Maintaining a strong balance sheet and liquidity profile which allows us to manage risk as well as to be nimble and adaptive
- Increasing exposure to the secondaries market given its attractive market dynamics and return profile
Your share in ICG Enterprise Trust provides access to a unique portfolio of private companies, and we will continue to invest your capital in businesses which we believe are resilient and capable of delivering growth. 2026 will inevitably bring both challenges and opportunities, which we will approach with care, deliberation, and a focus on creating long-term shareholder value. Managing for the long-term does not mean standing still in periods of uncertainty; rather, it means being clear on our investment criteria and being able to act decisively when opportunities arise.
Thank you for your continued support.
Oliver and Colm
Past performance is not a reliable indicator of future results.
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