NEW CANAAN, CT – July 22, 2020 – Deal volume in the home health and hospice sector slowed in the second quarter of 2020, down 55% with 10 publicly announced transactions, compared with 22 acquisitions in the first quarter of 2020, according to data from HealthCareMandA.com and Deal Search Online. M&A activity declined further by 63%, compared with the second quarter of 2019.
Only one transaction disclosed a price in the second quarter of 2020. Amedysis, Inc. acquired Plano, Texas-based AseraCare Hospice for $203 million in cash, providing a significant boost to its market reach and census. AseraCare Hospice cares for more than 2,100 patients daily and employs more than 1,200 hospice professionals in 44 locations across 14 states.
“Before the coronavirus epidemic hit in mid-March, deal flow was expected to pick up toward the end of the second quarter, due to the impact of the Patient-Driven Groupings Model by the Centers for Medicare and Medicaid Services,” said Lisa E. Phillips, editor of The Health Care M&A Report, which publishes the data. “The virus really shut down a lot of deal making in the second quarter. We expect to see it return in the third and fourth quarters, as hospitals in some states resume elective surgeries. Investor interest hasn’t faded in the home health and hospice sector, it’s just deferred for a few months.”
In the second quarter, private equity firms and their sponsored companies were the most active buyers, accounting for 60% of all activity. Bristol Hospice, a portfolio company of Webster Equity Partners, added Pro Hospice Agency, Inc. for undisclosed sum. Webster and Bristol Hospice together have announced three transactions so far in 2020.
Another high-profile buyer, The Pennant Group, Inc., which was spun out of The Ensign Group in October 2019, acquired two hospice agencies in Arizona: Prime Hospice, operating in the Phoenix metro area, and Harmony Hospice of Arizona, located in Kingman and serving northwestern Arizona.
All quarterly results are published in The Health Care M&A Report, which is part of the HealthCareMandA.com investment research source. For sector-specific research and analysis, please see The Home Health and Hospice Acquisition Report 2019. 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 headquarters in New Canaan, Connecticut. The company publishes research reports and newsletters and maintains databases on the healthcare and senior housing M&A markets.
