(Bloomberg) -- Private equity firms are under high pressure from sponsors to exit companies, with selling activity likely to pick up after the US election, according to Anthony Diamandakis, the global head of Citigroup’s global asset managers team.

Buyout firms’ portfolios are bigger than they have ever been, and “the pressure is high” to return cash to investors, Diamandakis said in an interview with Manus Cranny and Dani Burger on Bloomberg TV. The banker, who leads the team at Citi that advises alternative asset managers, expects selling activity to pick up over 2025-2027, making up for a lack of exits over the prior few years.

While disagreements over price have led to some private equity deals falling apart this year — such as KKR & Co.’s sale of Upfield — Diamandakis said that earnings have generally been strong, and operating performance for many firms has also been good given the economic environment.

While there might be some discounts around multiples, “I’d expect sellers to be able to sell for more reasonable values going forward,” he said.

In new deals, Diamandakis expects to see more take-private activity, and for sponsors to continue to have a big focus on technology and tech-related deals.

His comments come amid a global rebound in deals after a two-year slump. Private equity firms have announced almost $250 billion in deals this year, up around 29% from 2023. That includes big-ticket deals like CD&R and Stone Point’s $15.5 billion deal for Truist’s insurance arm as well as Silver Lake’s $13 billion buyout of entertainment conglomerate Endeavor Group.

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