April 18, 2018

Home health, hospice M&A activity spikes in 1Q

The home health and hospice sector had 21 publicly announced mergers in the first quarter, a 67 percent increase over the fourth quarter of 2017 and 5 percent more than the year-ago quarter, according to new data from HealthCareMandA.com, part of Norwalk's Irving Levin Associates.

The deal volume follows three straight quarters of relatively low home health and hospice merger and acquisition activity.

Price was disclosed for three of the 21 transactions in this year's first quarter, with sales totaling $46.1 million. That was similar to last year's first quarter, but far below last year's fourth quarter, when nearly $4.1 billion was announced for just two acquisitions.

About 62 percent of the first quarter's deals were done by private companies, and only four were announced by publicly traded companies.

"Most transactions in the home health and hospice space are small, and typically do not come with disclosed prices," stated Lisa Phillips, editor of The HealthCare M&A Report, which publishes the data. "The number of transactions in the first quarter was the highest since the fourth quarter of 2016 (24 acquisitions), and it may be a sign that investment interest has returned after some regulatory headwinds diminished in the fourth quarter."

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