New Canaan, Connecticut, October 11, 2023 /PRNewswire-PRWeb/ —
M&A activity in the Physician Medical Group (PMG) sector in Q3:23 fell to a total of 120 publicly announced acquisitions, according to data captured in the LevinPro HC database and published by Irving Levin Associates, LLC. The decline marks a 20% decrease from Q2:23 when 150 acquisitions were reported, a 15% decrease from Q1:23 with 141 deals and a 31% decrease from Q3:22 when 173 transactions were announced.
Private equity (PE) firms and their sponsored platform companies remain the most active investors in the PMG market, accounting for 63% (75 transactions) of all announced transactions. PE groups such as Amulet Capital Partners, LP, Webster Equity Partners and The Jordan Company were active in the quarter with several deals each.
“Despite heavy fragmentation across many specialties with a lot of opportunity for consolidation, high interest rates and labor issues have limited investor interest in the physician group M&A market,” stated Kate Humphrey, an analyst at LevinPro HC.
One of the most notable deals of Q3:23 was Orlando Health’s acquisition of Florida Medical Clinic, an internal medicine practice with 52 locations across the state. The practice is run by more than 2,000 employees, including 350 providers focused on 40 medical specialties.
While most PMG transactions do not disclose a purchase price, it is unusual for no deals in an entire quarter to do so, which was the case in Q3:23. The disclosed spending in Q1:23 totaled more than $106.3 million across three deals with prices and the second quarter reached more than $2.1 billion across two acquisitions with prices.
MB2 Dental Solutions, a portfolio company of Charlesbank Capital Partners, made a significant impact in the market as the most active acquirer, announcing 15 transactions in Q3:23. Yet, this is a 32% decrease from the company’s Q2:23 activity when it reported 22 acquisitions. MB2 Dental Solutions is one of the leading dental services organizations in the country and has been a major player in the PMG market for the past several years.
Keeping up with the trend of past quarters, the most active specialty was dental, with 42 acquisitions, or 35% of PMG’s total deals in Q3:23. There were 11 transactions reported in the dermatology space and eight in the cardiology market. With an aging population, investors are gravitating towards those spaces to address the heightened demand in caring for skin and heart conditions.
“OB/GYN and fertility has seen a fair amount of activity, as the average age of women giving birth for the first time has increased substantially over the years,” continued Humphrey. “There are still many opportunities for investors to carve out a space of their own in the fertility market, so watch out for new deals.”
All quarterly results are published in The Health Care M&A Report, which is part of LevinPro HC, a research intelligence platform published by Irving Levin Associates, LLC. For information, or to order the reports, call 800-248-1668. Irving Levin Associates is celebrating more than 70 years of delivering exclusive M&A intelligence to its sophisticated audience of seniors housing and healthcare investors. The company was established in 1948 and has offices in New Canaan, Connecticut and North Bethesda, Maryland. The company publishes research reports and newsletters and maintains databases on the healthcare and senior housing M&A markets.