Hospital M&A Activity Holds Steady in Q2: 2015

FOR IMMEDIATE RELEASE Lisa Phillips, Editor
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NORWALK, CT – July 27 2015 – The hospital acquisition market held steady in the second quarter of 2015. Twenty-three transactions were announced in the second quarter, equaling the 23 transactions in the first quarter of this year and down by one deal compared with the second quarter of 2014. Spending in the second quarter reached $2.0 billion, compared with approximately $693 million in the first quarter of 2015 and just $542 million in the second quarter of 2014, based on disclosed prices. “Hospital transactions have become trickier to track in recent years, as some hospitals and health systems have formed strategic partnerships, joint ventures or clinical collaborations. The 23 announced in the second quarter are true mergers or acquisitions,” said Lisa E. Phillips, Editor of the Health Care M&A Report. With a total of 56 hospital deals recorded in the first half of 2015, M&A activity in this sector could surpass the 100 hospital transactions announced in 2014.

The majority of the $2.0 billion spent on hospital deals was the result of a single transaction, which was also the largest hospital acquisition of the past 12 months. Ventas, Inc., one of the largest healthcare REITs in the United States, acquired Ardent Health Services for $1.75 billion. Ardent Health is one of the 10 largest for-profit hospital companies in the United States, and was a portfolio company of Welsh, Carson, Anderson & Stowe. Ventas will own 10 hospitals comprising about 3.2 million square feet and 2,045 beds. The acquisition price works out to $885,746 per bed, but with Ardent’s approximately $2 billion in annual revenue, the price-to-revenue was a modest 0.88x. Concurrent with the transaction’s closing on July 7, 2015, Ventas sold Ardent's hospital operations to Equity Group Investments, LLC, for $475 million.

All quarterly results are published in The Health Care M&A Report for all 13 sectors of health care, which is part of the Health Care M&A Information Source.  For more information, or to order the report, call 800-248-1668.  Irving Levin Associates, Inc. was established in 1948 and has headquarters in Norwalk, Connecticut. The company publishes research reports and newsletters, and maintains databases on the health care and senior housing markets.

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