In the first half of 2025, private equity firms and their sponsored companies (“PE Buyers,” collectively) announced 326 transactions in the healthcare M&A market, or approximately 32% of all the 1,036 announced healthcare deals, according to data captured in the LevinPro HC platform.
The deal volume in Q2:25 (148 deals) represents a nearly 17% decrease in M&A volume from Q1:25 (178 deals). Activity in Q2:25 is also 24% lower than the 194 PE-backed transactions reported in the second quarter of 2024.
For the first two quarters of the year, disclosed spending reached more than $32.8 billion across 17 transactions. The first quarter saw more than $29.9 billion in disclosed spending and Q2:25 saw more than $2.89 billion over six acquisitions.
The second quarter’s largest price, with a PE buyer, was Investindustrial’s acquisition of DCC Healthcare for $1.4 billion. DCC Healthcare is the healthcare unit of DCC plc, an Irish international sales, marketing and support services group. Investindustrial is a private equity firm headquartered in London, United Kingdom. It was an all-cash transaction.
Physician Medical Groups (PMG) drew the highest interest from PE Buyers, with 114 deal announcements, accounting for nearly 35% of all PE activity in the healthcare space. The PMG activity was nearly split evenly between the first and second quarters; there were 58 PMG PE-backed transactions in the first quarter and 56 in the second. However, the second quarter’s activity marks a 26% decrease from the combined 154 PE-backed PMG transactions for the first and second quarters of 2024. Additionally, quarter over quarter, Q2:25 is lower than Q2:24 that saw 80 deals.
In the PMG sector, PE Buyers targeted dental practices in roughly 54% of the acquisitions in Q2:25, with 30 transactions, which is less than the 34 announced in Q1:25, and less than the 46 reported in Q2:24.
PE Buyers also turned their attention to the eHealth market, announcing 48 transactions in the first two quarters, or 15% of all PE activity. There were 25 eHealth transactions in the first quarter of 2025 and 23 in Q2:25. This is relatively on par with the eHealth M&A activity seen in Q1:24 (20 deals) and Q2:24 (25 deals). The most active specialty across the two quarters was revenue cycle management (RCM) with a combined 17 transactions.
New Mountain Capital, LLC, a private equity group based in New York City with more than $55 billion assets under management, was the most active buyer in the eHealth space in the second quarter. It purchased SmarterDx, a clinical AI company that develops automated pre-bill review tech, and Thoughtful AI, an AI-powered RCM automation company. Both transactions were announced in April with undisclosed prices. In the first quarter, the PE group acquired
Access Healthcare, a technology-enabled RCM platform.
In Q2:25, there were 20 PE-backed Other Services transactions, 10 Laboratories, MRI and Dialysis deals, nine Home Health & Hospice deals and eight Behavioral Health Care acquisitions.
The two most active PE-backed buyers in the first two quarters were MB2 Dental Solutions and Elliott Bay Capital Trust with nine transactions each. In the second quarter, Elliott Bay Capital Trust was the most active buyer with four announced deals. The second most active PE-backed group was Heartland Dental, backed by KKR & Co. Inc., which reported seven transactions in the two quarters.
Other companies with multiple transactions in the second quarter include OneOncology Inc. (four), Dental365 (three), ENT Partners, LLC (three) and SALT Dental (three).
“The decline in private equity healthcare deal volume reflects growing investor caution amid tightening margins, regulatory headwinds and rising capital costs,” said Kate Humphrey, Editorial Analyst at Levin Associates. “Despite this decease, some investors and advisors maintain minimal optimism that private equity could regain momentum in upcoming quarters, provided market conditions stabilize.”
