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Trend Reports

2016 Full Year

 
 

2016 l Full Year l Trends Report l Healthcare Industry

Thursday, January 19, 2017

2016 Key Highlights

  • Three of the industry's top five and six of the top ten highest value acquisitions in 2016 were completed by financial sponsors.
  • The largest private equity backed deal during the year was Blackstone Group's announced acquisition of TeamHealth, a provider of outsourced physician staffing solutions for hospitals in the U.S., for $6.02 billion.
  • Strategic acquirers represented 80 percent of aggregate volume and 58 percent of value in 2016.
  • The Healthcare IT segment was responsible for five of the overall industry's top ten highest value deals in 2016.

2016 Key Trends

  • Total transaction volume in 2016 remained constant over 2015, at 452. This represented a 16 percent rise relative to 2014.
  • Strategic volume in 2016 increased three percent over 2015, from 351 to 363. Private equity backed volume fell 12 percent during this timeframe, from 101 to 89.
  • Total transaction value in 2016 saw a gain of 75 percent over 2015, from $17.47 billion to $30.51 billion. Excluding IMS Health's merger with Quintiles Transnational Holdings, value increased 25 percent.
  • The median revenue multiple decreased from 3.0x in 2015 to 2.6x in 2016. The median EBITDA multiple moved slightly from 13.2x to 13.9x.

M&A Market Overview

Berkery Noyes tracked 1,292 Healthcare/Pharma Information and Technology transactions between 2014 and 2016, of which 277 disclosed financial terms, and calculated the aggregate value to be $51.99 billion. Based on known transaction values, we project values of 1,015 undisclosed transactions to be $11.36 billion, totaling $63.34 billion worth of transactions tracked over the past three years.

Disclosed median enterprise value multiples for all segments combined in this report during the last 36 months were 2.7x revenue and 13.2x EBITDA.



 

Transaction Volume/Value & Multiples

Transactional Analysis

Strategic vs. Financial Comparison

Purchaser Analysis

Transaction By Volume Segment