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Thank you for visiting HealthcareBanker.com a news aggregator of middle-market mergers and acquisition activity in the healthcare industries. This site addresses investment banking topics dealing with M&A, Capital Raising, Borrowing/Lending and other Corporate Development and Finance activities within the Healthcare Services, Healthcare IT, Medical Device, and Life Science industries.

Monday, February 20, 2017

Q4 2016 Healthcare Services M&A Pulse - Volume, Value, Multiples

2016 Ends Strong Despite Lower Volume & Values

M&A activity in US Healthcare Services remained strong in 2016 when compared to other industries, despite seeing lower year over year deal values and volume. 

Overall deal volume in 2016 was slightly lower (1.4%) then in 2015, while deal value was significantly lower (59.6%) primarily as a result of several large 2015 Managed Care deals. 2016 Q4 was basically flat vs. Q3 with little movement both up and down on deal volume (1.3%) and deal value (-8.7%). 

The Affordable Care Act (ACA) continues to have a significant influence in Healthcare Services M&A driving both vertical and horizontal integration, as the shift from traditional fee-for-service reimbursements moves towards value-based payment models, spurring consolidation and resulting in larger but fewer players in the industry. 

However, despite the new administrations promise to repeal and replace the ACA the shift towards value-based care is not intrinsically tied to it, thus Healthcare Services transaction activity should remain strong in 2017 as payers and providers look to provide care at a lower cost with better outcomes.