Long-Term Care M&A Logs Red-Hot First Quarter

Transaction activity in the long-term care space continued at a red-hot pace in the first quarter of 2014, up more than 36% from last year, according to an Irving Levin report on M&A in the health care industry. 

Deal volume for the nine health care services sectors tracked in The Health Care M&A Report, released in April, declined 8.1% overall on a quarterly basis but increased by 3.8% from 2013’s first quarter. In dollar volume, health care services logged $12.4 billion of deals, down 28% from the fourth quarter’s $17.3 billion but more than doubling last year’s $5.6 billion. 

Including the four health care technology sectors, transactions dropped 14% from the fourth quarter of 2013, but rose 12.7% from one year prior. 


The 60 long-term care deals in the first quarter of 2014 mark a 7.7% decrease from the fourth quarter. However, that represents a 36.4% increase from one year ago, when there were 44 transactions.

“The Long-Term Care sector, which is usually most active in the fourth quarter, almost equaled its record [fourth quarter of 2013] performance,” notes Irving Levin. “That’s a torrid pace compared with the year-ago first quarter.” 

Five of the health care services sectors saw their deal volume decrease on a quarterly basis: home health & hospice, hospitals, long-term care, physician medical groups, and rehabilitation. 


On an annual basis, transaction volume declined  for four sectors—behavioral health care, home health & hospice, hospitals, and physician medical groups—and remained flat for a fifth sector, rehabilitation. Managed care logged a 150% volume increase from two deals last year to five.

“Health care merger and acquisition activity has recovered from the lull it saw in the first quarter of 2013. The equity markets are performing even stronger than last year, and the implementation of the Affordable Care Act didn’t slow deal-making in some sectors,” said Lisa E. Phillips, editor of The Health Care M&A Report, in a statement. “With that uncertainty gone, we expect to see a couple of busy quarters ahead.”

Written by Alyssa Gerace

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