The Health Care M&A Monthly: The New Year’s M&A Market--
Seventy-One Deals Announced Worth $7.6 Billion
Merger and acquisition activity in the health care industry proved to be strong in January. A total of 71 transactions were announced; their combined value is approximately $7.6 billion. Deal making appears to be coalescing into a familiar pattern: while deal volume is split roughly 50-50 between the services and technology segments, the technology segment continues to capture the lion’s share of M&A dollar volume.
The nine services sectors generated 38 deals, or 54% of the total deal volume, with the technology sector accounting for the remaining 33 deals (46%). Notably among the individual sectors, Medical Devices posted 15 deals, which is more than one-fifth of the industry’s total deal volume.
However, the technology segment attracted $6.5 billion, or 86% of the total dollar volume. Among individual sectors, Biotechnology claimed the greatest number of dollars, $3.1 billion, or 44% of all dollars spent on health care M&A.
For much of January, the M&A market appeared to be in a holding pattern. This is only natural, since it coincided with earnings season in which analysts try to read the tea leaves to see which way the markets are headed. With the possibility of a double-dip recession fading rapidly into the background, the economy in general seems to be sounding a positive note, and this is reflected in upbeat M&A activity. Sanofi-Aventis’ (NYSE: SNY) proposed acquisition of Genzyme Corp. (NASDAQ: GENZ), now priced in the neighborhood of $20.0 billion, appears to be progressing. Further, in the beginning of February, Danaher Corp. (NYSE: DHR) announced its $5.9 billion acquisition of Beckman Coulter (NYSE: BEC), a deal that will be treated in detail in our next issue of The Health Care M&A Monthly. The year is thus poised for a robust round of deal making.