A higher provide of house well being and residential care companies is fueling a rise in dealmaking exercise, in response to the newest M&A replace from advisory agency Mertz Taggart. That’s additionally true for hospice transactions.
General, there have been no less than 44 house well being, house care and hospice offers within the third quarter of 2021, three greater than the earlier quarter and 20 extra greater than Q1. Over the previous three years, solely the ultimate quarter of 2020 noticed extra transaction exercise, the Mertz Taggart replace notes.
Whereas deal numbers are up, the spike has little to do with a newfound curiosity from patrons or skyrocketing demand, Mertz Taggart Managing Companion Cory Mertz defined within the replace.
As a substitute, ongoing business burnout, the potential of a capital-gains tax improve and the looming Residence Well being Worth-Based mostly Buying (HHVBP) Mannequin growth are producing stronger provide.
“All three sub-industries stay robust, however the elevated exercise has little to do with elevated demand,” Mertz stated. “Demand has been robust for a number of quarters and continues. It is a supply-driven market.”
There have been no less than 16 house health-related offers in Q3 2021, the identical as within the second quarter of this yr.
Just some of them: In July, the Visiting Nurse Affiliation (VNA) bought its house well being and hospice operations to Amedisys Inc. (Nasdaq: AMED), whereas LHC Group Inc. (Nasdaq: LHCG) bought Cavalier Healthcare Providers in August. In September, LHC Group additionally introduced the acquisition of 23 house well being places, 11 hospice companies and 13 remedy companies from the enterprise between Brookdale Senior Residing Inc. (NYSE: BKD) and HCA Healthcare (NYSE: HCA).
In the meantime, there have been no less than 18 house care-related transactions in Q3 2021, in response to Mertz Taggart. That was barely lower than the 19 house care offers that occurred within the earlier quarter.
Main house care offers, for instance, included Honor’s acquisition of Residence As a substitute Senior Care and ModivCare Inc.’s (NYSE: MODV) $340 million buy of CareFinders Complete Care.