Home Health & Hospice M&A Market Fell in Q1:2022

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After a strong year for the Home Health & Hospice M&A market, dealmaking in the first quarter of 2022 slowed, with 30 publicly announced transactions, according to data from LevinPro HC.

Home Health & Hospice M&A market activity fell in the first quarter of 2022, with 30 publicly announced transactions, compared with 41 acquisitions in the fourth quarter of 2021, based on new acquisition data from LevinPro HC. However, this quarter was still busier than first quarters have historically been. Compared to the first quarter of 2021, which only saw 26 deals, and the first quarter of 2020, which had 23 deals within the sector, this quarter was relatively healthy for the sector, based on trends from the LevinPro HC Database, which can be accessed here

Most transactions in the Home Health & Hospice sector do not have a disclosed price, but there were still some notable deals. Total spending in the first quarter was more than $7.6 billion, based on disclosed prices, whereas in Q4:21 there was just $863.9 million in transaction value. The largest deal was the acquisition of LHC Group, Inc. (NASDAQ: LHCG) by Optum, a significant part of UnitedHealth Group (NYSE: UNH), for $5.4 billion in cash. With debt included, the deal total comes to $6 billion. Based in Lafayette, Louisiana, LHC Group, Inc. is a national provider of home health, hospice, home- and community-based services and facility-based care in 37 states and the District of Columbia, reaching 60% of the U.S. population aged 65 and older. LHC Group had a full year 2021 revenue of $2.22 billion.

Interest from private equity buyers and their sponsored companies dipped in Q1:22. Private equity was involved in just nine of the 30 Home Health & Hospice acquisitions in the first quarter, or 30% of all transactions. This is a significant drop from the fourth quarter of 2021, when more than 60% were private equity-backed.

“After the breakneck pace of M&A in the fourth quarter of 2021 and as COVID restrictions have waned, it was only a matter of time before deal activity returned to more normal levels,” said Dylan Sammut, Editor of Healthcare at Irving Levin Associates, which publishes the data on its Levin Pro HC platform. “However, 30 transactions within a single sector, including some big ones, is still a healthy total. If labor problems are solved across the country, or at least are stabilized, investors should continue to pour into the sector.”

All quarterly results are published in The Health Care M&A Report for all 13 sectors of health care, which is part of the LevinPro HC 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 New Canaan, Connecticut. The company publishes research reports and newsletters and maintains databases on the healthcare and seniors housing M&A markets.

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