1. Following on from last week: Germany moves from numbers to doctrine
Last week we wrote that "Germany is too often forgotten". Week 31 documented, on PitchBook data, the fastest-growing ecosystem in European venture — €6bn raised in H1 2026, deep tech and defence as the engines, close to half of Europe’s most highly valued defence start-ups headquartered in Germany. The policy leg was missing. It is now public.
On 22 July, the federal government adopted a national start-up and scale-up strategy comprising 152 measures (some press accounts round it to "about 150") spanning financing, research transfer, security and defence, bureaucracy, public procurement, talent and internationalisation. Two features stand out for an investor. First, the money: the WIN initiative — short for Wachstums- und Innovationskapital für Deutschland, "growth and innovation capital for Germany", a public-private partnership launched in September 2024 by the Federal Ministry of Finance with state bank KfW and a coalition of private investors (Deutsche Bank, Commerzbank, DZ Bank, Allianz, BlackRock, Bayerische Versorgungskammer), originally sized at €12bn to 2030 — sees its target raised to €25bn of commitments across banks, insurers and the federal budget. The Deutschlandfonds, meanwhile, is presented as a vehicle providing more than €30bn of start-up financing. Second, the doctrinal break: a new structure is being created to allow the federal state to take direct equity stakes in start-ups and scale-ups, including in defence — where German state-backed funds had until now operated under ethical guidelines expressly excluding weapons and military applications. Katherina Reiche, Federal Minister for Economic Affairs and Energy, describes a strategy "laying the foundations for the next generation of German global market leaders", through "lowering bureaucratic hurdles, mobilizing more private and public VC, and making it easier to create start-ups directly from academia".
The market had already voted. On 13 July, Helsing (Germany, privately held, headquartered in Munich) — the defence AI platform founded in 2021 and frequently described as Europe’s Anduril, after Anduril Industries (US, privately held, headquartered in Costa Mesa, California), founded in 2017 by Palmer Luckey — the creator of the Oculus headset sold to Facebook — and now the world’s benchmark for venture-funded defence: drones, autonomous surveillance towers, underwater vehicles and AI-driven weapons systems, valued at $61bn in May 2026 following a $5bn Series H led by Thrive Capital and Andreessen Horowitz — closed a $1.8bn Series E valuing the company at $18bn, with Dragoneer Investment Group, Lightspeed Venture Partners, Disruptive, Iconiq, Growth Equity at Goldman Sachs Alternatives, JPMorganChase, Canada Pension Plan Investment Board, General Catalyst, Plural and Stepstone. The round was first reported at $1.2bn in May: it grew 50% larger without the price moving, and ownership remains predominantly European.
What it means. Germany is converging three things France struggles to align: a credible defence budget trajectory (3.5% of GDP by 2029), private capital willing to write billion-dollar cheques, and now a state prepared to take direct equity positions in sovereign-adjacent sectors. For French managers, the question is no longer whether the German ecosystem deserves a look, but on what terms to co-invest in it.
Sources: KfW, WIN initiative — joint commitment, September 2024
Startbase, cabinet approval of the start-up and scale-up strategy (152 measures)
Startup City Hamburg, key points of the strategy
Helsing press release, $1.8bn Series E
CNBC, 13 July 2026
Sifted
Recap — PE Research, Week 31, section 4 "Germany is too often forgotten"
2. L Catterton sells Thorne to Procter & Gamble for $3.8bn
On 4 August, L Catterton (US, privately held) announced a definitive agreement to sell Thorne, the US science-backed supplements business, to The Procter & Gamble Company (US, NYSE-listed) for $3.8bn in cash. L Catterton had taken Thorne private in October 2023 in a buyout valued at roughly $680m. The exit therefore comes in under three years.
The deal is a reminder that strategic buyers remain live bidders for quality assets, not just the sponsor-to-sponsor trades that dominate 2026 volumes. A note of caution on the gain: the gap between $680m and $3.8bn does not mechanically translate into fund profit — acquisition debt, follow-on equity and management dilution are not disclosed. Press references to a "$3bn-plus return" are an estimate derived from the enterprise value differential, not a distribution figure released by the fund. Closing is expected in the fourth quarter of 2026.
Sources: L Catterton press release (PR Newswire), 4 August 2026
Kirkland & Ellis, counsel to the seller
Jones Day, counsel to the buyer
Bloomberg, 4 August 2026
3. easyJet falls to Apollo: £5.7bn, as Castlelake’s withdrawal unlocks the deal
On 6 August, Castlelake (US, an aviation and credit specialist manager) withdrew from the contest without stating a reason, after Apollo Global Management (US, NYSE-listed) raised its offer. The easyJet board (UK, listed on the London Stock Exchange) promptly recommended a firm offer from Apollo at 715 pence per share in cash, valuing the airline at £5.7bn (around €6.6bn). Completion is expected by the end of the first quarter of 2027, subject to shareholder and regulatory approvals.
This closes a months-long saga. Castlelake had four successive proposals rejected, including one at 650 pence on 25 June that the board considered undervalued the company; Apollo entered formally on 10 July. The final price therefore carries a material premium over the rejected offers — evidence, if any were needed, that a board holding firm on value can lift the bidding. Apollo has said it supports the existing strategy, does not intend to cut jobs in the first year following completion, and will retain the airline’s UK and EU headquarters.
Two readings for an investor. First, scale: this is one of the largest UK take-privates of the year, on a cyclical, capital-intensive, fuel-exposed asset — a profile private equity was avoiding not long ago. Second, the message to the London market: the persistent discount on UK equities continues to attract American capital, and European aviation is no longer exempt. One caveat: closing is not a given, and the employment and headquarters commitments made in a UK offer are time-limited undertakings under the Takeover Code.
Sources: easyJet, Apollo offer updates page
Bloomberg, 6 August 2026 (Castlelake withdrawal)
Euronews, 6 August 2026
AviTrader, 7 August 2026
CNBC, 10 July 2026 (Apollo enters the process)
4. Secondaries: Adams Street raises over $5bn as the market clears $200bn
On 3 August, Adams Street Partners (US, privately held, more than $73bn in assets) announced over $5bn of commitments for its latest secondaries programme, including a $2.7bn close for Global Secondary Fund 8. The programme is roughly 50% larger than its predecessor. The firm will deploy across both LP-led deals (investors selling existing fund interests) and GP-led transactions (continuation vehicles initiated by managers).
The backdrop explains the appetite: secondary transaction volume passed $200bn for the first time on an annual basis last year, and continuation funds have established themselves as a first-order liquidity mechanism against a still-narrow exit market.
Preqin data captures the balance of power. In its Secondaries in 2026 report, Vice President Brigid Connor notes that in Q1 2026, 71% of private equity secondaries funds closed above their target size, against 67% in 2025. For context, private equity secondaries accounted for 8% of total private equity AUM in 2023, a share Preqin forecasts to reach 11% by 2030.
Sources: Adams Street press release (Business Wire via Morningstar), 3 August 2026
Preqin, Secondaries in 2026 (Brigid Connor), data as of March 2026
Preqin, forecast of a record $250bn secondaries volume in 2026
Alternatives Watch, 3 August 2026
AltAssets
5. The critical view: the "zombie problem" hits a record
On 3 August, CEPR published its monthly BUYOUTS newsletter. A word on the source, since the acronym invites confusion: this is the Center for Economic and Policy Research, a Washington-based think tank founded in 1999 and co-directed by economists Dean Baker and Eileen Appelbaum — not to be confused with London’s Centre for Economic Policy Research, an academic network with no editorial line. The US CEPR sits on the left and takes an openly critical stance on private equity; Eileen Appelbaum, co-author with Rosemary Batt of Private Equity at Work, is its most-quoted voice on these questions. Its monthly BUYOUTS letter should be read for what it is: documented, sourced monitoring work, but advocacy. All the more reason to check the figures — which they generally get right. The most striking point this month: according to PitchBook data reported by the Wall Street Journal, the net asset value of US private equity assets stuck in funds at least ten years old reached an all-time high of $348.5bn at the end of 2025 — 3.5 times the 2015 level. These are unrealised NAVs, that is, manager valuations: which is precisely what the debate is about.
Sources: CEPR, BUYOUTS — August 2026, 3 August 2026
Wall Street Journal (zombie funds, PitchBook data)
References of the week
L Catterton press release — sale of Thorne to Procter & Gamble, 4 August 2026
Adams Street Partners — secondaries programme close, 3 August 2026
CEPR — BUYOUTS: Private Equity Reshaping the Economy, August 2026
easyJet — firm £5.7bn Apollo offer recommended, 6 August 2026
Preqin, Secondaries in 2026 — 71% of secondaries funds closing above target in Q1 2026, data as of March 2026
German federal government — start-up and scale-up strategy (152 measures), 22 July 2026
Helsing — $1.8bn Series E at an $18bn valuation, 13 July 2026
Methodological note: unless otherwise stated, transaction values are those disclosed by the parties. Net asset values of unliquidated funds are manager valuations and unrealised. Market volume projections cited come from intermediaries and are estimates.
