NEWMARK

Healthcare M&A: 2021 In Review

Commentary by Eric Murphy, Managing Director, Global Healthcare Services


Healthcare merger and acquisition activity had a consistent theme throughout 2021: fewer transactions, yet total transaction revenue and average size of the seller by revenue reached all-time highs.


In its Healthcare Merger & Acquisition Activity Report: 2021 M&A in Review, Kaufman Hall reported that 2021 finished with 49 announced transactions, compared with 79 in 2020. The average annual revenue of the smaller partner in 2021 was $619 million, up from $388 million in 2020. 69% of the 2021 transactions consisted of not-for-profit providers acquiring another not-for-profit provider.


The decrease in the number of transactions was driven by companies seeking more strategic partnerships where the transaction can increase market share, add new capabilities and bolster intellectual capital.


Looking ahead to 2022, it’s predicted that the number of transactions will remain lower as compared to previous years. This decrease will be a result of providers choosing strategic partnerships to meet patients’ evolving, more consumer-driven demands. There will be an emphasis on providing the right services to patients, driven by internal growth or partnerships that provide new capabilities and/or geographies.


Notable Transactions for 2021


Merger of Spectrum Health and Beaumont Health– Announced in June 2021, the two largest providers in Michigan will merge to create a $12-billion health system that includes 22 hospitals, 305 outpatient facilities and Spectrum’s Michigan-based health insurance plan, Priority Health.


Merger of Intermountain Healthcare and SCL Health – Based in the Mountain West, the systems combined to operate 33 hospitals, making it an $11-billion system.


Steward Health Care acquisition of Tenet Hospitals – In South Florida, Tenet Healthcare Corporation announced the sale of five hospitals and their associated physician practices to Steward Health Care for $1.1 billion. The acquisition will double the size of Steward’s footprint in Florida.

All information contained in this publication is derived from sources that are deemed to be reliable. However, Newmark has not verified any such information, and the same constitutes the statements and representations only of the source thereof, and not of Newmark. Any recipient of this publication should independently verify such information and all other information that may be material to any decision that recipient may make in response to this publication, and should consult with professionals of the recipient's choice with regard to all aspects of that decision, including its legal, financial, and tax aspects and implications. Any recipient of this publication may not, without the prior written approval of Newmark, distribute, disseminate, publish, transmit, copy, broadcast, upload, download, or in any other way reproduce this publication or any of the information it contains. This document is intended for informational purposes only and none of the content is intended to advise or otherwise recommend a specific strategy. It is not to be relied upon in any way to predict market movement, investment in securities, transactions, investment strategies or any other matter.

Download Our
Brochure

Sign Up for Our Newsletter

VIEW 2022 HEALTHCARE OUTLOOK