Global private equity dealmaking collapsed in August, with announced transactions down 47% month-over-month and total capital committed falling to $34.1 billion from July's $64.3 billion. Healthcare accounted for $18.2 billion of that total, representing 53% of all PE activity for the month. No other sector cleared $4 billion.
The August figures mark the steepest single-month contraction since February, when seasonal factors and rate uncertainty kept most sponsors on the sidelines. Technology, which averaged $22 billion per month in the first half of the year, posted just $3.7 billion in August. Industrials fell to $2.9 billion from a six-month average of $11.4 billion. Consumer discretionary, historically the second-largest PE allocation after tech, recorded $2.1 billion, the lowest reading since March 2023. Financial services and energy combined contributed $3.8 billion, leaving healthcare to carry the entire monthly load.
Healthcare's resilience reflects structural advantages that insulate it from the rate sensitivity plaguing other sectors. Demographics favor continued capital deployment: the U.S. Census Bureau projects 73 million Americans will be aged 65 or older by 2030, up from 58 million today. PE funds have been warehousing capital for healthcare roll-ups since late 2024, waiting for valuation compression. August valuations in the sector averaged 11.2x EBITDA, down from 13.8x in Q4 2023, finally triggering deployment. Three of the month's five largest deals were healthcare platform builds: a $4.6 billion dermatology consolidation, a $3.9 billion behavioral health take-private, and a $2.8 billion orthopedic services carve-out.
The divergence creates immediate tactical questions for allocators. Funds with healthcare overweights are deploying at attractive entry multiples but face execution risk if labor costs continue rising; registered nurse wages are up 18% year-over-year in major metros. Funds underweight healthcare are sitting on $1.2 trillion in dry powder globally, increasingly concentrated in sectors where entry points remain unattractive. Technology multiples are still 14.7x EBITDA on average, well above the 12.1x threshold most sponsors target for IRR models above 20%. The capital overhang creates pressure to deploy, but August's collapse suggests sponsors are willing to wait rather than chase.
Watch for September's dealmaking figures in early October to confirm whether August was an anomaly or the start of a broader pullback. If technology and industrials stay below $10 billion combined for two consecutive months, expect fund extensions and timeline adjustments across 40-60 active raise processes currently in market. Healthcare's pricing window likely closes by year-end as $47 billion in targeted capital chases the same platform opportunities.
The sector weighting has already shifted. Healthcare now represents 31% of year-to-date PE capital deployed, up from 19% at the same point in 2024. That concentration hasn't existed outside a recession since 2009.