Home health and hospice acquisition activity dipped in the third quarter of 2019, according to acquisition data from HealthCareMandA.com.
Deal volume in the home health and hospice sector dipped slightly in the third quarter of 2019, down 23% with 20 publicly announced transactions, compared with 26 acquisitions in the second quarter, according to data from HealthCareMandA.com. Compared with the third quarter of 2018, home health and hospice M&A activity decreased by 20%, when 25 acquisitions were announced. Six of the transactions disclosed prices in the third quarter of 2019, for a combined total of nearly $1.2 billion. In the same quarter of 2018, the total dollar value based on disclosed prices was just $7.2 million.
Of the 20 transactions announced in the third quarter, 35% were announced by private equity firms or their platform companies. An unusual pairing for this market involved a joint venture formed by TowerBrook Capital Partners, an investment management firm, and Ascension, the largest not-for-profit Catholic health system in the country. The organizations teamed up to acquire Hospice Compassus, a portfolio company of Formation Capital and Audax Private Equity, with operations in 25 states, for approximately $1 billion. “Despite the slight dip in total transactions in this quarter, we’re seeing strong interest in growing national home health and hospice platforms,” commented Lisa Phillips, editor of The Health Care M&A Report, which publishes the data. “Publicly traded players were also very active, accounting for 45% of the deals announced in Q3:19.”
Two companies tied for the most transactions. Arosa+LivHome, a portfolio company of Bain Capital Double Impact, and LHC Group, Inc. each announced three transactions. Addus HomeCare and Nova Leap Health Corporation announced two transactions apiece.
Based on disclosed prices, spending in the quarter totaled $1.156 billion, with the Hospice Compassus deal accounting for the majority share. That total is 429% higher than the previous quarter’s $218 million.
All quarterly results are published in The Health Care M&A Report for all 13 sectors of health care, which is part of the HealthCareMandA.com investment research source. For information, or to order the report, 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 Norwalk, Connecticut. The company publishes research reports and newsletters and maintains databases on the healthcare and senior housing M&A markets.