The Health Care M&A Monthly: Fourth Quarter M&A Results -

Same Story: More Deals, Fewer Dollars Than 2011

As the days dwindled down in the fourth quarter of 2012, health care mergers and acquisitions piled up higher than they had in the same period of 2011. M&A dollar volume, however, was way off the pace of Q4:11, which was itself lower than Q4:10. Based on data available in early January, the M&A market in Q4:12 generated 288 deals worth a combined total of $23 billion. Health care services again accounted for the majority of the deal activity in the quarter, but just like the previous fourth quarter, the technology sector captured the lion’s share of the
dollar volume.

The quarter did show a 30.3% gain over the 221 deals posted in the previous quarter, but the total was only 9.5% higher than the 263 deals recorded in the year-ago quarter, Q4:11. Dollar value for the quarter, at $23 billion, was down 43.8% compared with the same period in 2011, which had close to $41 billion. To put that in sharper relief, Q4:11 deal values were 29.1% lower than in Q4:10, which had a total of $57.8 billion for 287 deals. Four billion-dollar deals of 2012 were announced in the fourth quarter of 2012—a far cry from the year-earlier quarter when eight deals surpassed the billion-dollar mark. By that measure, the combined total of top-10 deals in Q4:12 declined 44.1%, to $15.7 billion. In Q4:11, the top 10 deals had a combined total of $28 billion.

In Q4:12, the health care services category posted 175 deals, and 57.8% of the quarter’s total volume. Health care technology deal volume hit 113, up by only three deals compared with the same period in 2011. At the same time, dollar volume for the technology sector was down 56% compared with Q4:11, due to the dearth of billion-dollar deals seen the previous year.

The health care technology segment attracted just $12.4 billion for a total of 113 announced mergers and acquisitions. Technology deals accounted for just a 39.2% share of deal volume but a 53.8% share of deal value in the quarter. Medical Devices led the category with $7.5 billion, followed by Biotechnology (with $2.7 billion reported) and Pharmaceuticals ($1.8 billion reported). eHealth brought up the rear with just $313.3 million in reported deals.........Want to read more? Click here for a free trial to The Health Care M&A Information Source and download the current issue today