Hospital M&A Activity Slowed Further in The First Quarter of 2020

NORWALK, CT – April 17, 2020 – Hospital M&A activity slowed again in the first quarter of 2020, according to new acquisition data from Nineteen transactions were reported, a drop of 21% compared with the fourth quarter of 2019 and 34% lower than the third quarter, when 29 deals were reported. Dollar volume also declined, totaling only $397 million, based on disclosed prices. That represents an 87% drop from $3.2 billion in Q4:19. Year over year, Q1:20 spending was down 94% versus the $6.2 billion reported in the same quarter in 2019.  

“The decline in hospital deals probably wasn’t related to the COVID-19 pandemic,” said Lisa E. Phillips, editor of the Health Care M&A Report, which publishes the data. “Deal announcements were spread fairly even throughout the quarter, with six in January, seven in February and six more in March. Those deals primarily targeted financially struggling standalone hospitals.” 

Only five deals in the first quarter were for multi-facility health systems. Beaumont Health in Michigan acquired Akron, Ohio-based Summa Health and its four hospitals. LifePoint Health sold three South Carolina hospitals to Prisma Health in Greenville. Deaconess Health System, the Carle Foundation and HCA Healthcare each acquired two hospitals in Illinois, Kentucky and Florida, respectively. 

“Now that the pandemic has hit the United States, the only hospital transactions we’re seeing are those that were already in bankruptcy proceedings,” Phillips added. “That may be the new norm until hospitals can resume elective surgeries and get their finances in order.” 

All quarterly results and hospital M&A activity are published in The Health Care M&A Report, which is part of the investment research source. For sector-specific research and analysis, please see The 2020 Health Care Services Acquisition Report. For more information, or to order the reports, 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 health care and senior housing M&A markets.