BERLIN, June 6 (Reuters) - Advisers and investors

congregated at the annual SuperReturn conference in Berlin this

week as a still struggling private equity market cast a shadow

over the meeting for a second year, although there were flashes

of optimism among the attendees.

At a long row of streetside alpine huts where an overflow of

the globe's top deal brokers conversed, some talked of

resilience in the face of adversity as higher borrowing costs

continued to put the brakes on the private equity industry.

Attendees complained about a lack of deals, with gaps in

valuations between buyers and sellers persisting. One lawyer,

who declined to be named, said there was a "survive to 25"

mindset among some private equity clients, who hope deal-making

might recover next year.

"Probably the biggest challenge we face is the geopolitical

uncertainty and the resulting volatility and reduced

visibility," said Daniel Pindur, managing partner at CVC

in an interview ahead of the conference. "We are

optimistic, while resilience and the ability to adapt remain

essential criteria."

The conference, mainly held behind the chessboard facade of

the InterContinental Hotel with an expected 5,000-plus

attendance, takes place as buyout funds sit on an ever growing

mountain of assets to sell amid a collapse in fundraising.

This year saw the slowest start for private equity deal

making since 2020, with the smallest number of transactions year

to date across Europe, Middle East and Africa, according to

Dealogic.

Still, deal values have crept up to $101 billion, compared

to just $68 billion at the same point in 2023 but still less

than half at this time in the peak years of 2021 and 2022.

Global buyout-backed exits fell 44% to $345 billion last

year from 2022 and globally the value of ageing, un-exited

companies hit a record high of $3.2 trillion, according to

consultancy Bain & Company. There was also a 38% drop in funds

closed to 449 in 2023 versus 2022.

Speakers at the conference, which is covering issues such as

the rise and use of artificial intelligence and the pressure on

private equity to deploy its cash, include some of the

industry's biggest asset managers such as Carlyle and

Apollo.

"Within private markets green shoots are appearing, for

example in infrastructure, which is being recognised for its

defensive attributes," said EQT partner Asis Echaniz,

while conceding that any upturn in mood was far from across the

board.

While companies have taken advantage of subdued private

equity activity to seize cheaper rivals, with relatively lower

valuations in regions like the UK, investors believe they can

find profitable opportunities.

Mark Danzey, head of capital Markets and institutional

client solutions in Europe at KKR & Co ( KKR ), said he sees a

healthy pipeline of M&A activity including corporate carve outs

as well as public to private deals involving companies that are

not being rewarded by markets.

Investors also pointed to opportunities in the energy

transition and decarbonisation of the economy, and the roll out

of digital infrastructure.

"The market for high quality businesses with proven

management teams and track records is very active," said Max

Fowinkel, managing director at Warburg Pincus.

The gap in valuations bestowed by buyers and sellers may

bedevil some deals but it is significantly smaller in the case

of "high quality companies with a great management team and a

strong financial profile", said Florian Kreuzer, head of the

German-speaking region at buyout group Permira.

Pressure remains on private equity to invest funds raised

and one investor, speaking on condition of anonymity, said

executives are working away at "quality" deals, putting in more

time to build relationships that might facilitate a successful

completion.