Deal activity in the Behavioral Health Care sector was consistent with most of the previous quarters. Although deal volume slipped 14% from the previous quarter, it rose 20% compared with the same quarter a year earlier. The fourth quarter’s total of 12 deals represents 22% of the 54 transactions announced in the past 12 months.

Private equity firms accounted for all but one acquisition in the fourth quarter, as smaller firms sold companies and larger firms purchased them as add-ons to their existing portfolios. Universal Health Services (NYSE: UHS), which operates inpatient psychiatric hospitals, was the only publicly traded acquirer in this quarter.

Substance abuse treatment programs and facilities were the most popular targets in Q4:17, with six deals announced. Programs that benefit individuals with developmental disabilities, including autism, made up four of the acquisitions. Eating disorders and mental health counselling accounted for one deal each.

Source:, January 2018

None of the deals announced in the fourth quarter disclosed prices.

Dollars Spent on Behavioral Health Care Mergers & Acquisitions, by Quarter

Q4:16 Q1:17 Q2:17 Q3:17 Q4:17
$874,000,000 $149,595,000 $380,000,000 $110,000,000 $0

BayMark Health Services, a portfolio company of Webster Capital, announced two acquisitions in the quarter. The Lewisville, Texas-based company specializes in medication-assisted treatment (MAT) for opioid addiction and dependency, as did its two targets: Private Clinic in Columbus, Georgia and Health Care Resource Centers, Inc. in Chelsea, Massachusetts. The latter operates 15 treatment centers in three New England states and manages a 16th center in Connecticut. Its affiliated brands are Community Health Care, Inc.; Merrimack River Medical Services, Inc. and Community Substance Abuse Centers, Inc.

Two private equity firms teamed up on one deal. Lee Equity Partners and FFL Partners acquired a controlling stake in Summit Behavioral Healthcare LLC. Flexpoint Ford and certain other investors exited the company, which was founded in June 2013. Summit focuses on substance abuse and addiction disorders through its treatment centers in 10 states.