Health Care M&A Results for The Fourth Quarter of 2004

	The Health Care M&A Monthly
In the January 2005 issue: Health Care M&A Results for The Fourth Quarter of 2004 The fourth quarter of 2004 posted 213 mergers and acquisitions in the health care industry. Based on revealed prices, a total of $50.7 billion was committed to finance this activity. ... The Year in Health Care M&A During 2004 a total of 871 M&A deals were announced in health care. To pay for this activity, a total of $191.3 billion was committed, the largest amount dedicated to health care M&A in the past five years. See page 12 ... The Month in Deals Though deal volume in January resembles that in prior periods, with 67 deals posted, the dollar amount committed to fund M&A activity plunged from 2004’s lofty levels. Just over $1 billion was spent to fund transactions during the past four weeks, as compared with an average $16 billion per month in 2004. See page 2 ... In The Departments Deal Summaries p5 Additional Transactions p9 Transaction Updates p9 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 Fourth Quarter of 2004 During the fourth quarter of 2004, a total of 213 deals were announced in the 13 sectors of the health care industry. The contribution of each sector to the total appears below. As throughout the entire year, the Long-Term Care sector lead the health care services segment in deal volume while the Pharmaceuticals sector led the corresponding technology segment. While maintaining its lead pace in deal volume, the Long-Term Care sector underwent a fundamental shift: Just as distressed properties were disappearing from the market during the second half of 2004, quality properties and portfolios emerged to take their place. With capital flowing back into the senior care market and cap rates declining, some of the prices paid were the richest we have seen in five years. The top three sectors in deal volume for Q4:04, Pharmaceuticals (39), Medical Devices (32) and Long-Term Care (27), together accounted for 98 deals, or 46% of the quarter’s total M&A activity. The fourth quarter’s 213 deals represent just a 2% decline from the 218 transactions announced in the previous quarter and a 9% decline from the 233 deals posted in the year-ago quarter, Q4:03. What They Paid The real story, as always, lies in the prices paid to make these deals. Based on information revealed to date, a total of $50.7 billion was committed to finance the fourth quarter’s 213 transactions. This figure represents a 138% increase from the $21.3 billion that was committed to fund health care M&A in Q3:04, and a 13% increase over the $44.7 billion spent in Q4:03. The dollar amounts committed in each sector are listed in the table above, while their percentage contribution to the total is plotted in the chart opposite. Medical Devices tops the list in terms of price paid. In a year that was packed with billion-dollar deals, the fourth quarter posted eight, three of them in the Medical Device sector alone. A combined total of $29.5 billion, or 58% of the $50.7 billion spent on all of health care in Q4:04, was committed to fund the 32 deals in Medical Devices. Taken together, the Medical Device and Pharmaceutical sectors accounted for 76% of the quarter’s total. Adding in Biotechnology and e-Health, the health care technology segment attracted just short of 80% of all dollars committed to finance the quarter’s M&A activity. The Fourth Quarter’s Place in 2004 The amount paid in Q4:04 represents 27% of the $191.3 billion committed during all of 2004 to finance the year’s 871 transactions. The quarter’s deal volume accounts for 24% of the year’s total. Thus, Q4:04 accounted for roughly one-quarter of the year’s M&A activity.
	Companies mentioned in this issue: Able Home Health p3 Advica Health Resources p15 Aeterna Zentaris p14 Affiliated Computer Services p14 Allion Healthcare p11 Alltracel Pharmaceuticals p15 Andrx p16 Animas Corp. p15 Antisoma plc p13 Aptamera, Inc. p13 Ardent Health Services p4 Associated Healthcare Systems p4 Aventis p12 Banc of America Securities p16 Bayer Corp. p16 Biolase Technology p15 Bionomics p11 BlueCross and BlueShield of Minnesota p14 Bluefield Regional Medical Center p4 Bristol-Myers Squibb p16 Buckeye Community Health Plan p11 Cape County Dialysis p4 CareSouth HomeCare Professionals p3 Centene Corp. p11 Christus Health p3 Christus HomeCare p3 CLW Health Care Services Group p10 CNL Retirement Properties p10 Comprehensive Addiction Programs p11 Comprehensive Renal Care of Northlake p4 Corixa Corp. p13 Coventry Health Care p14 CRC Health Care p10 Cygnus p15 DaVita p4 Dialysis Clinic p10 Diodem LLC p15 Down River Centers p4 East Georgia Regional Dialysis p4 Echelon Biosciences p14 Edocs p14 Eli Lilly p16 FountainGlen Properties, LLC p10 Gambro AB p10 Genentech p13 GlaxoSmithKline p16 Harriman Jones Medical Group p11 Harvard Pilgrim Health Care p14 HCA p4 Health Plan Administrators p11 HealthCare Partners Medical Group p11 Healthcare Transactions Group p11 Healthology p14 Horizon Bay Senior Communities p10 Humana p14 Independence Blue Cross p14 Independence Holding Company p11 Insurers Administrative Corporation p11 Invitrogen p16 iVillage p14	Johnson & Johnson p15 Kindred Health Care p4 King Pharmaceuticals p16 LAM Pharmaceutical Corp. p16 Lincare p3 Managed Care Transaction Manager System p14 Medical Resources of Kansas City, Inc. p3 Merriam-Graves p4 Merrill Lynch & Co. p11 Methodist Hospital System p3 MetroNational Corp. p10 My Choice Medical Holdings p11 Mylan Laboratories p16 Neoforma p11 Neurofit p11 New World Kellerton p16 Norak Biosciences, Inc. p13 North American Home Health Supply p11 Oakwood Care Center p10 Oakwood Care Center, LLC p10 Optive Research p13 Orleans Metropolitan Dialysis Clinic p4 OrthoRehab p11 Otto Bock Industry p11 Pfizer p12 Pharmacia p12 Physician Informatics p14 Plaza Respiratory & Oxygen Services, Inc. p3 PracticeOne p14 PracticeXpert p14 Princeton Community Hospital p4 Procter & Gamble p16 ProRhythm p15 Prudential Real Estate Ventures p10 Quovadx p14 Renal Care Group p4 Roche Holding p16 Royal Health Care of Long Island, LLC p14 Samaritan Hospital p4 sanofi-aventis p12 Sanofi-Synthelabo p12 Siebel Systems p14 Sprint p14 St. Jude Medical p15 Stonehedge Convalescent Center p10 Summa Health System p11 SummaCare p11 Superior Consultant p14 Tenet Healthcare Corp. p3 The Gardens at Kentland p10 Tripos, Inc. p13 Tufts Health Plan p14 University HealthSystem Consortium p11 Vanguard Health Systems p4 Ventas p4 Verizon p14 Vertrue p11 VHA, Inc. p11 Visiting Nurse Association of Houston p3 Westone Products p15 Xsira Pharmaceuticals p13 Zymed Laboratories p16
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