Healthcare Merger and Acquisition Activity Remains Active

Healthcare merger and acquisition activity remained active during the third quarter of 2022, with 734 publicly announced deals, according to Irving Levin Associates. While some sectors, such as hospitals and managed care, had a significant increase in activity, others like medical devices experienced a slowdown. Transaction volume in the third quarter of 2022 remained virtually the same, with deal totals in the second quarter of 2022 but increased by nearly 20 percent compared with the third quarter in 2021. 

Healthcare merger and acquisition deal value totals increased slightly from $57.74 billion in the second quarter of 2022 to $58.2 billion during 2022’s third quarter. The total disclosed dollars spent fell dramatically from the $145 billion reported in the third quarter of 2021. 

The managed care sector experienced a 78 percent increase, with nine deals in the second quarter of 2022 and 16 transactions in its third quarter. The hospitals sector had 12 deals in the second quarter of 2022 and 20 in its third quarter, resulting in a 67 percent increase in activity. Medical devices reported a 44 percent decrease in deal totals, dipping from 45 deals in second quarter of 2022 to 25 deals in the third quarter. 

The sector with the highest announced deal activity in the third quarter was physician medical groups, with 170 deals followed by 140 for other services, which include staffing companies, ambulatory surgical centers, urgent care centers and other ancillary healthcare services. 

Private equity activity has been strong and consistent all year, pushing ahead of investment totals in 2021. During the third quarter of 2022, there were 245 transactions made by private equity firms or their portfolio companies, representing a 12 percent increase over the third quarter of 202, when 217 transactions involved private equity.