CVs Now Established as Exit Route Alongside M&A and IPO: Moelis’s Hammer

Why It Matters

By adding CVs to the exit toolkit, GPs can unlock liquidity without sacrificing future upside, reshaping capital deployment strategies across the private equity ecosystem.

Key Takeaways

• Continuation vehicles now mainstream exit option
• Secondaries specialists drive GP adoption of CVs
• CVs complement M&A and IPO strategies
• Offer liquidity while preserving portfolio upside
• Moelis highlights CV growth at NEXUS 2026

Pulse Analysis

Continuation vehicles, often referred to as CVs, have moved from niche transactions to a mainstream component of private equity exit planning. Originally designed to extend the life of high‑performing assets, CVs allow general partners to transfer ownership stakes to specialized secondary investors who possess deep expertise in valuing and managing mature portfolios. The rise of dedicated secondary funds has lowered execution friction, making CVs a viable alternative when traditional routes such as mergers, acquisitions, or initial public offerings face market headwinds.

For GPs, CVs provide a flexible liquidity bridge that preserves upside potential while addressing limited partner cash‑flow demands. By selling a portion of a fund’s holdings to a secondary buyer, managers can secure near‑term capital without triggering a full exit, thereby maintaining exposure to future value creation. This hybrid approach complements M&A and IPO strategies, allowing firms to tailor exit timing to portfolio performance and market conditions. Moreover, the involvement of seasoned secondary investors brings operational expertise that can enhance asset stewardship during the continuation phase.

The broader acceptance of CVs reshapes the private equity landscape for both investors and capital markets. Limited partners gain an additional avenue for liquidity, potentially improving fund‑level returns and reducing concentration risk. Meanwhile, secondary firms benefit from a growing pipeline of high‑quality assets, reinforcing their role as strategic partners rather than mere buyers of distressed stakes. As Moelis’s Jeff Hammer highlighted, the continued specialization of secondary buyers will likely accelerate CV adoption, prompting GPs to integrate continuation strategies into standard exit planning and capital allocation frameworks.