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M&A Deal and
Dollar Volume for 2007 and 2006*
Deal
Volume
Dollar Volume
Sector 2007
2006 % Change
2007 2006 % Change
Behavioral Health 13
24 -46% $ 58,000,000 $
1,771,000,000 -97%
Home Health 48
55 -13% 1,485,000,000
842,000,000 76%
Hospitals 57
56 1% 8,416,000,000
35,738,000,000 -76%
Laboratories, MRI, Dialysis 52 46
13% 5,303,000,000
2,537,000,000 109%
Long-Term Care 125 146
-14% 14,719,000,000
22,629,000,000 -35%
Managed Care 28
28 0% 8,804,000,000
1,254,000,000 602%
Physician Medical Groups 41 32
28% 98,000,000
237,000,000 -59%
Rehabilitation 14
9 56% 432,000,000
153,000,000 182%
Other 104
136 -24% 14,245,000,000
30,888,000,000 -214%
Services Subtotal 482
532 -9% $ 53,560,000,000 $
96,049,000,000 -44%
Biotechnology 142
115 23% $ 40,632,000,000 $
36,407,000,000 12%
E-Health 59
74 -20% 1,505,000,000
4,863,000,000 -69%
Medical Devices 191 150
27% 57,936,000,000
53,268,000,000 9%
Pharmaceuticals 177
138 28% 72,862,000,000
77,851,000,000 -6%
Technology Subtotal 569
477 19% $ 172,935,000,000 $
172,389,000,000 0%
Grand Total 1,051
1,009 4% $ 226,495,000,000 $
268,438,000,000 -16%
*Preliminary Figures
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“Health care M&A activity remained robust in
2007 even with the contraction in the credit markets due to the midsummer
subprime mortgage meltdown,” stated Stephen M. Monroe, managing editor at
Irving Levin Associates, Inc., which publishes The Health Care M&A Report.
“Even with private equity groups pulling back, thanks to the preponderance
of strategic buyers in the market, the year produced a total of 50
billion-dollar deals, worth a combined total of over $153.6 billion, at the
brisk rate of almost one a week.”
The four sectors of the health care technology segment, including
Biotechnology, e-Health, Medical Devices and Pharmaceuticals, posted 569
deals, or 54% of the year’s deal volume. A combined total of $172.9 billion,
virtually the same amount as was spent in 2006, was committed to the
technology sector in 2007. “Three stalwart sectors, Pharmaceuticals, Medical
Devices and Biotechnology combined, garnered 76% of all the dollars
committed to health care M&A in 2007,” observed Sanford Steever, Ph.D.,
editor of the Report. “The average acquisition premium in the health care
industry for 2007 was 27%, which is 35% greater than the corresponding
average across all industries. This signals continuing investor faith in the
health care industry.”
Despite the year beginning with a number of uncertainties, merger and
acquisition activity in the health care industry is expected to be strong in
2008. “Many players are waiting for valuations to settle down and stabilize
before jumping back into the market,” Mr. Monroe indicated. “The backlog of
capital waiting to be invested, as well as competitive pressures on
strategic buyers, guarantees the continuation of a robust M&A market.”
The fourth quarter of 2007 witnessed 292 mergers and acquisitions worth
$51.4 billion. “With the highest level of M&A activity in 2007 reached
during the fourth quarter, the signs are auspicious for health care mergers
and acquisitions in the coming year,” Mr. Steever concluded.
For more information on The Health Care M&A Information Service, The Health
Care Acquisition Report or for a subscription to any Irving Levin
publication, call 800-248-1668. Irving Levin Associates, Inc., established
in 1948, has headquarters in Norwalk, CT and is online at
www.levinassociates.com. This
privately held corporation publishes research reports and newsletters, and
maintains merger and acquisition and venture capital databases, on the
health care and senior housing markets.
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