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Irving Place Capital Exits Universal Hospital Services
Irving Place Capital Management scored big in August — $1.74 billion big. The private equity firm sold Universal Hospital Services, a medical equipment management company, to Federal Street Acquisition Corp. (NASDAQ: FSAC), a special purpose acquisition company sponsored by an affiliate of Thomas H. Lee Partners. Universal Hospital’s diverse customer base includes over 4,000 acute care hospitals, 4,000 alternate site providers, and over 150 major medical equipment manufacturers. Under the terms of the agreement, Federal Street and Universal Hospital will combine under a new holding company to be named Agiliti, Inc., which intends to apply to have its common stock and warrants... Read More »
PaxVax Changes Hands Again
Specialty vaccine maker PaxVax Inc. has changed owners again, more than doubling its equity value in two and a half years. The Redwood City, California-based company was acquired by Cerberus Capital Management in December 2015 for $105 million from Ignition Growth Capital and other investors. The sellers retained a minority stake, while Cerberus took the majority. In August, the company was sold to Emergent BioSolutions Inc. (NYSE: EBS), which develops and commercializes specialty products for use in biodefense and commercial markets. Emergent paid $270 million, 3.4x revenue, based on statements that the target’s 2019 revenues are expected to be between $70 million and $90 million.... Read More »
Disruption Hits the Digital Health Sector
Retailers have been the big disruptors in the healthcare market in recent months, but not in digital health. CVS Health (NYSE: CVS) and Aetna’s (NYSE: AET) merger, announced in December 2017, is still on track. Amazon’s (NASDAQ: AMZN) deal for PillPack has many wondering what’s next in the online pharmaceutical space. Now there’s Best Buy (NYSE: BBY), the consumer electronics retailer, entering the healthcare arena. The company announced on August 15 it was throwing down $800 million in cash to acquire GreatCall, Inc., an aging-in-place player, from GTCR. The private equity firm bought GreatCall about a year ago, in June 2017, for an undisclosed price.... Read More »
Buyers Flock to Pharmaceuticals, Again
Pharmaceutical deal activity made a comeback in the second quarter of 2018, with 41 transactions reported, and counting. That is the highest quarterly haul in two years, but what happened to dealmaking in the intervening period? Deal volume dropped off soon after the 2016 presidential election, as companies and investors waited for President Trump’s promised tax overhaul. That legislation came in December 2017, and activity in this sector has picked up accordingly. In fact, the second quarter’s deal volume was 64% greater than that of the first quarter, and 156% better than what was reported in the second quarter of 2017, the sector’s nadir. One of those transactions was a record-breaking... Read More »
UnitedHealth Doubles Down
UnitedHealth Group is not taking much time off this summer, in what continues to be one of the most active healthcare M&A years on record. It recently announced the acquisition of Peoples Health, a Medicare Advantage plan based in Metairie, Louisiana, that has 63,000 members. Included in the acquisition were four clinics plus Capital City Medical Group, a seven-physician medical group that practices near Baton Rouge and New Orleans. It also looks like UnitedHealth will be buying specialty pharmacy company Genoa Health from PE firm Advent International. Genoa Health has approximately 400 full-service pharmacies which are generally located within community mental health centers. The... Read More »
Seeking Cash and More Cash
After finishing up its strategic alternatives review, OvaScience, which is focused on developing treatments for infertility, decided the best way to go for shareholders was to merge into Millendo Therapeutics, a clinical-stage biopharmaceutical company focused on developing novel treatments for orphan endocrine diseases. OvaScience’s market cap was just $26 million, and it really hadn’t had any revenues yet. What it did have was cash, a total of $53.6 million of it (combined with short-term investments) as of June 30, 2018. Management at OvaScience must have thought that Millendo would have better use of that cash than for its own research. In merging with OvaScience, not only does... Read More »
The Power of the FDA
What happens when the FDA rejects not one drug application, but two, in a short period of time? Your share price plunges by nearly 90%. And then you look for options. Such was the dilemma faced by UK-based drug maker Vernalis plc. So, last March the Vernalis board started looking for offers to buy the company. One attraction was that it had close to $34 million of cash that would be at the disposal of a buyer. Publicly traded Ligand Pharmaceuticals emerged as the buyer, paying about $42 million, or a 45.7% premium to the closing price the day before the sales process was announced in March. It was just a 1.7% premium to the volume weighted average price for the three months before the... Read More »Health Care M&A Deals, Week Ending August 10, 2018
The Health Care M&A Weekly chart is a selection of transactions announced during the prior week(s). The deals presented here are from our Deal Search Online database, which is updated every business day. in the quarterly report. Visit www.dealsearchonline.com to see how Deal Search Online can help you stay up-to-date on the healthcare market overall, or in a particular sector of interest to your firm. Biotechnology Acquirer Target Price Key Biologics Astarte Biologics N/A Astellas Pharma, Inc. Quethera N/A eHealth Acquirer Target Price DHS Group Connect N/A Global Payments Inc. AdvancedMD $700 million Home Health Care & Hospice Acquirer Target Price Simplura Health Group Helping... Read More »
July 2018 Health Care Deals Simmered
July’s deal volume beat the totals posted in July 2017, but didn’t quite match those posted the previous month. The healthcare merger & acquisition market is still going strong, in other words. Not too hot, no sign of getting cold. Preliminary deal volume in July reached 124 transactions, a 10% loss compared with June’s busy 138 transactions but 6% better than the same month in 2017. The services sectors accounted for 58% of the month’s total, but percentage was actually lower than in June, when services made up 62% of the total, and in July 2017, when services made up 67% of the month’s volume. Some sectors that out-performed both the previous month and... Read More »Schedule a demo
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