The year hasn’t ended, and there are still two weeks to go in the fourth quarter of 2017. The holidays are already under way, with more on the horizon. Before we get too busy, here’s a quick look at where things stand in mid-December.
Total healthcare mergers and acquisitions reached 1,467 deals as of December 14. That’s only 7% lower than the combined total for all of 2016, at 1,574 deals.
Spending on these transactions is already higher. This year’s dollar volume currently stands at approximately $303.9 billion, up 18% compared with last year’s total of $256.7 billion.
Much of the credit for the spending rise goes to the largest single transaction announced in 2017, CVS Health’s (NYSE: CVS) $77 billion acquisition of managed care company Aetna (NYSE: AET). That deal accounts for 25% of the year’s spending, so far.
Without it, 2017’s spending total would stand at $226.9 billion, still a strong showing, but 12% below last year’s total.
Unless we see a few more mega-deals announced before Janaury 1, 2018, this year’s spending total won’t surpass the record $387.7 billion total compiled in 2014.
That was the year Actavis plc (then NYSE: ACT) agreed to pay $66 billion for Allergan Inc. (NYSE: AGN), which was battling a hostile takeover launched earlier in 2014 by Valeant Pharmacetucals International (NYSE: VRX). Actavis won the war and then changed its name to Allergan plc.
As of this writing, Humana Inc. (NYSE: HUM) is deep in talks to acquire Kindred Healthcare (NYSE: KND), with the help of The Carlyle Group (NASDAQ: CG) and TPG Capital. The rumored price, around $9.00 per share, represents no premium over Kindred’s close on December 14 at $8.15 per share, or approximately $782 million.
With a market cap of $793.3 million (at this moment) and $3.3 billion in debt, it’s no wonder someone close to the negotiations spilled the beans to Reuters and The Wall Street Journal.
If/when a deal is announced, we’ll have more to say. Right now, 2017 has been a very busy year for deal makers. And it ain’t over yet. Happy holidays, readers!
