The Health Care M&A Monthly October 2003

	The Health Care M&A Monthly
In the October 2003 issue: Health Care M&A Results for The Third Quarter of 2003 Both the volume of transactions and the amount paid to finance them increased against the second quarter’s levels. A total of $19.4 billion was spent on a total of 230 deals. See page 1 * “I’m Not a Deal Junkie” So says, Jeffrey Immelt, CEO of General Electric. Even so, his company’s recent $9.5 billion bid to acquire Amersham plc suggests more than a spartan appetite for dealmaking. It appears, in any event, to be a good match for the company’s diagnostic imaging business. See page 3 * The Month in Deals A total of 75 mergers and acquisitions were announced in the past four weeks. Based on revealed purchase prices, a total of $11.62 billion was committed to finance them. The health care technology segment accounted for 55% of the deal volume and 92% of the total dollars committed. Page 4 * In The Departments** Deal Summaries Page 5 Additional Transactions Page 10 Transaction Updates Page 10 Sign up for a trial subscription and get the current issue! Read more about The Health Care M&A Monthly. Read the past headlines.	Health Care M&A Results for The Third Quarter of 2003 Results are in for the health care M&A market during the third quarter of 2003. Reflecting a gradual improvement in the overall economy during the most recent quarter, both deal volume and the amount spent to finance this acquisition activity showed an increase over the previous quarter’s levels. A total of 230 deals were announced in 13 sectors of the health care industry, a 2% increase over the 226 deals announced in the previous quarter and a 10% increase over the 210 deals in the year-ago quarter (Q3:02). The table below breaks out the contribution of each sector to the quarter’s total deal volume, comparing it with the previous quarter (Q2:03) as well as the corresponding year-ago quarter (Q3:02). The 114 deals announced in the nine sectors of the health care services segment represented 49.5% of the quarter’s deal volume, with the 116 deals in the technology segment picking up the remainder. Thus, the services segment gained roughly 10 percentage points over last quarter when its 99 deals accounted for just 40% of that quarter’s total deal volume. The single most dramatic change in quarter-over-quarter M&A activity took place in the Hospital sector. Soaring 375% from four deals in Q2:03 to 19 deals in Q3:03, hospital mergers and acquisitions proceeded at a brisk pace. As comparison with the year-ago quarter makes clear, however, the hospital market was merely returning to historical levels of deal volume after a prolonged drought for the first six months of this year. The Long-Term Care sector posted the greatest number of deals in the services segment (25), but took fourth place overall, lagging behind three technology sectors: Medical Devices (36), Pharmaceuticals (34) and Biotechnology (32). These three sectors together accounted for 44% of the quarter’s deal volume. In stark contrast is the long-suffering Behavioral Health sector, which failed to muster enough interest from investors or dealmakers to post even a single deal.
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