Almost all mergers and acquisitions deals were done by private equity firms and strategic investors, which are incumbent companies that purchase another company to achieve synergies. Private equity firms and strategic investors can be competitors when they are bidding on the same target company, but strategic investors can also become potential buyers of private equity fund’s portfolio companies. Given their unique relationship, I selected the largest 20 strategic investors from 10 sectors and used logistic regression and panel data analysis to answer the question: Do mergers and acquisitions (M&A) activities of large-cap corporations in the previous year affect private equity firms’ investment decisions on similar companies? The logistic regression showed that if the target company has the same SIC code as the companies acquired by big-cap corporations in the previous year, this deal has 65.7% lower odds to be PE funded. The panel data analysis tells us for every 1% increase in the percentage of companies acquired by big-cap companies in a particular sector in the previous year, PE firms would acquire 0.159% more companies in that sector. These results jointly showed that if the big-cap companies made more acquisitions in a particular sector in the previous year, in the current year, private equity firms would acquire fewer similar companies (companies with the same SIC code), but would increase their investments in other companies of that sector. This finding can help investors, business owners, and stock traders make or adjust their investment decisions.