Evaluating Exit Strategies in Private Equity

ABC Capital is a private equity firm that has been involved in various investments across different sectors, focusing primarily on technology and healthcare. After several years of holding a significant stake in a promising healthcare technology startup, ABC Capital is considering its exit strategy. The firm has analyzed several options, including acquisition by a larger firm, an initial public offering (IPO), and a secondary buyout by another private equity fund.

The firm's investment committee is tasked with evaluating the most advantageous exit strategy that aligns with its financial goals and market conditions. As they prepare their recommendation, they must consider the implications of each exit option on returns, market sentiment, strategic fit, and timing.

Which exit strategy is likely to provide ABC Capital with the most liquidity and possibly higher valuation given favorable market conditions?