PE Firms Swarmed to Behavioral Health in Q4:17
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... Read More »2017 Biggest Healthcare Deals by Sector
2017 was another big year for billion-dollar healthcare transactions. Among the deals that disclosed prices, 44 topped the billion-dollar mark, for a total of approximately $263.1 billion. Although that number seems high, there were 50 billion-dollar deals announced in 2015, although those totaled a slightly lower $240.1 billion. 2016 posted lower totals for both the number of billion-dollar deals (39) and combined prices ($194.1 billion). Of course the biggest healthcare deal in 2017 was the $77 billion acquisition of Aetna Inc. (NYSE: AET) by CVS Health (NYSE: CVS). But there were many more sizable transactions across the sectors, as the chart below illustrates. See how many you remember... Read More »
New MainStream Adds On to Platform Companies
The recent crop of healthcare services platforms owned by New MainStream Capital is moving to the add-on stage. Last week brought two acquisition announcements from Omni Eye Services and CORDENTAL Group. Both companies were acquired in 2017. New MainStream committed $25 million in equity capital to buy CORDENTAL in March 2017. The Cincinnati-based company is a dental support organization that provides business support services to affiliated dental practices in the Mid-Atlanta, Midwestern and Southeastern regions. Omni Eye Services, based in Iselin, New Jersey, is an optometric referral practice providing a full range of specialty services for the advanced treatment of eye diseases. No... Read More »
Behavioral Health Care Deal Trends in 2017
The Behavioral Health Care sector has enjoyed growing interest from private equity and other investors in recent years. Federal legislation regarding coverage of mental health conditions certainly boosted that interest, as has the growing public acceptance of the magnitude of need for services. Also, the fragmented nature of this sector has kept platform-building acquisitions rather low. From a focus standpoint, behavioral health care covers mental health issues, as well as substance abuse, eating disorders, autism spectrum services and care for individuals with developmental disabilities. Co-morbidities often exist, particularly between mental health and substance abuse conditions. Then... Read More »
Stat of the Week: Add-on Behavioral Deals +225%
Behavioral health care mergers and acquisitions are setting new records in 2017. With two months left in the year, announced transactions in this sector have already surpassed 2016’s then-record of 45, making it the most active year for M&A. What’s driving deal activity? Earlier in the year, we saw a couple of REIT acquirers move into the space, which is something that didn’t happen last year. REIT activity has since tapered off. The real driver is private equity firms building out their portfolios. In 2016, PE firms made 11 direct behavioral health acquisitions and 13 add-on deals via a portfolio company, according to our database. So far in 2017, private equity firms have only made... Read More »Schedule a demo
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