June 2017 Deal Volume Shows Continued Strength
Preliminary data for the month of June shows that investors are still bullish—or at least comfortable—betting on health care. Some 123 transactions were announced last month, an 11% decrease compared with May’s 138 transactions. Year over year, however, this early data is just 5% below the 130 deals announced in June 2016. For a little perspective, April 2017’s deal volume was just 104 transactions, which made the May numbers look very strong by comparison. June’s deal volume looks reassuringly healthy, as it is close to the year-ago total, and could be adjusted upward in the future as more deals come to light. The same trends we’ve noted in previous months are still playing out, too. Deal... Read More »Kindred Exits Skilled Nursing Business
Kindred Healthcare (NYSE: KND) has made no secret that it is getting out of the skilled nursing business. It took until June 30 for the deal announcement to come, and when it did, it was a bit of a surprise that a single buyer was taking over the entire business. Private equity firm BlueMountain Capital Management, LLC, through a joint venture it is leading called BM Eagle Holdings, agreed to acquire Kindred’s 89 skilled nursing facilities. BlueMountain, you may recall, acquired the financially failing Daughters of Charity hospital system in California in July 2015, following the collapse of Prime Healthcare Services’ $849 million bid in March 2015. A week after this deal with Kindred... Read More »
Investors Want Health Care Services with No Strings Attached
Preliminary data for the month of May shows an encouraging uptick in deal volume, with the services sectors making up 66% of the total. Some 134 transactions were announced last month, a 30% increase over April’s anemic 103 deal volume total. But monthly transaction totals in 2017 are not keeping pace with those in 2016. A year ago, 151 transactions were announced, 11% higher than in May 2017. There’s no question that the ongoing uncertainty surrounding the American Health Care Act hangs heavily on healthcare investors. The Senate Republicans have been at work behind closed doors to craft a different deal than the one sent to them by the House Republicans in mid-May. From the handful of... Read More »Hospital Deals Rebound in May 2017
Hospital merger and acquisition activity was fairly quiet in the first four months of the year, totaling 24 deals that made to a definitive agreement or beyond. Then came May, with a combined total of 13 transactions announced in the first four weeks (through May 26). Deal volume in the hospital sector through May 26 now totals 37 transactions, targeting 79 hospitals with 13,854 beds. The nearly $2.3 billion combined spending includes the $1.4 billion just announced by Medical Properties Trust (NYSE: MPW), which acquired the real estate assets of 10 acute care hospitals and one behavioral health facility (approximately 2,400 beds) belonging to IASIS Healthcare, a TPG portfolio company.... Read More »Financial Buyers Announce 59 Deals in Q1:17
Financial buyers, which include real estate investment trusts and private equity firms, are not the dominant players in the health care M&A market. Their participation depends on many factors, with valuations being an important determinant, (see chart below). Middle-market private equity firms, in particular, have had a hard time getting into and then winning auctions for health care entities in the past few years, as strategic buyers have outspent or even pre-empted auctions. In the first quarter, financial buyers accounted for 15% of the deal volume, with 59 deals, which is slightly lower than the previous four quarters. The first quarter featured eight deals that topped the $1.0... Read More »Schedule a demo
Gain access to the best healthcare and long-term care investment intelligence, data, and analysis.
