Home Health and Hospice M&A Activity Remains Stable in Q4:2017


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NORWALK, CT – January 18, 2018 – For three straight quarters, merger and acquisition activity in the Home Health & Hospice sector has remained stable with 12 or 13 transactions in each quarter. The fourth quarter of 2017 posted 13 transactions, up from 12 in each of the third and second quarters, but down from 16 acquisitions in the fourth quarter of 2016, according to new acquisition data from HealthCareMandA.com. This steady activity has slowed from the 17 publicly announced acquisitions in the year’s first quarter.

Home health and hospice has been making a lot of headlines as the “go-to” care protocol to help drive down healthcare costs and to keep patients out of institutions. One of the continued problems is the payment sources and payment levels, which always come under pressure. That didn’t stop four private equity firms from announcing acquisitions, including Silver Oak Services Partners, Tenex Capital Management, The Vistria Group and Webster Capital.

Two other private equity firms, TPG Capital and Welsh, Carson, Anderson, & Stowe, teamed up with Humana to make the largest home health and hospice acquisition of the year. The target was Kindred Healthcare and its leading home health and hospice business. The total acquisition was valued at $4.1 billion, with Kindred’s home health and hospice segment valued at $3.1 billion of the total. It will be split off from the rest of Kindred’s business into a separate company with Humana owning 40% with plans to eventually own 100%. It represents the second largest home health and hospice acquisition ever. “Even though the number of transactions were somewhat light in the fourth quarter, the dollars committed were near record levels,” commented Lisa Phillips, editor of The Health Care M&A Report, which publishes the data.

In the second largest transaction of the fourth quarter, LHC Group purchased Almost Family for $983.1 million. Almost Family has revenues of more than $777 million and operates out of 332 branch offices. Combined with the Kindred Healthcare transaction, more than $4 billion was invested in the home health and hospice space in the fourth quarter of 2017, representing a record level of spending in a quarter.

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, Inc. 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 markets.

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