Health Care M&A Spending Leaps 171% in Q2:2014, Compared with Q1:2014, According to
<0> Lisa E. Phillips, EditorStephen M. Monroe, PartnerPhone: 203-846-6800Fax: 203-846-8300 </0>
Spending on health care mergers and acquisitions hit a new record for second quarter spending, according to. The combined total for M&A activity in the second quarter reached $135.2 billion, up 171% compared with the first quarter spending total ($49.9 billion), and up 152% versus the same period the year before ($53.6 billion). (View full video: .) The vast majority of that combined spending—91%—came from transactions on the Technology side, while Services contributed just 9%.
Deal volume also increased substantially in the second quarter, up 13% versus the previous quarter, to 297 transactions. The quarter also gained (20%) in comparison with the second quarter a year ago, when 248 deals were announced. Services transactions accounted for 52% of the Q2:14 deal total, and Technology transactions made up 48%.
Deal volume surged on the Technology side, to 143 deals, an increase of 31% compared with the previous quarter. Dollar volume exploded by 229%, to nearly $123 billion. While multi-billion-dollar pharmaceutical deals made headlines in Q2:14, the Medical Device sector actually turned in the highest dollar volume among the Technology segments, thanks to the $42.9 billion acquisition of Covidien plc by Medtronic Inc., which made up the majority of the total $59.1 billion spent in that sector. Pharmaceuticals had a combined total spending of $56.4 billion for the quarter.
On the Services side, deal volume remained flat at 154 deals, down 1% compared with the previous quarter. Dollar volume was also stagnant at $12.3 billion, representing a 3% drop in the same period, although this segment typically has fewer prices disclosed. Long-Term Care transactions led this category, with 60 deals and $5.2 billion in combined spending. The Physician Medical Group sector posted 15 transactions for the quarter (up 15% vs. Q1:14), but reported an unusually large deal for this sector, at $2.35 billion, as Amsurg Corp. acquired Sheridan Healthcare Inc. from private equity firm Hellman & Friedman.
“Now that the health information exchanges are functioning, investors have decided that health care is a good place to be,” said Lisa E. Phillips, editor of . “The equity markets are still rewarding the big-deal makers, as well. At this point, it looks as if this momentum could carry well into the third quarter.”
For more information on or , or for a membership to any of Irving Levin Associates’ subscriptions, please call 800-248-1668. Irving Levin Associates, Inc., established in 1948, has headquarters in Norwalk, Connecticut and is online at . This privately held corporation publishes research reports and newsletters, and maintains merger and acquisition databases, on the health care and senior housing markets.
Health care mergers and acquisitions gained strength in the second quarter of 2014,while spending on those deals exploded to record levels.
acquisition, takeover, merger, health care, M&A, long-term care, technology, services, pharmaceuticals, long-term care, physician medical groups, second quarter 2014, first quarter 2014, deal volume, healthcare transactions, healthcare deals