Acquisitions of physician practices by Private Equity has exploded over the last six years.
All types of medical practices have been consolidating over the past 10+ years. While transaction volume declined in 2020 activity accelerated. 2021 will be a record year for completed transactions.
2021 projects that private equity investment in behavioral health will reach an all-time high as investors seek to cash in on the growing demand for therapeutic services.
The behavioral health market is highly fragmented which is always a catalyst for consolidation. COVID-19 added to that and created an increased opportunity in M&A activity.
COVID-19 affected behavioral health in a substantial way which is creating a path for M&A opportunities.
We think about private equity-backed consolidations as part of a lifecycle. Like most business cycles, it starts out with pioneering that accelerates through further adoption.
There are now thirty private equity firms with investments in dermatology practices and surgery centers.
Our research on ophthalmology transactions in 2020 showed that roughly half of seller groups were represented by an investment banker or M&A advisor.
An investment banker specialized in medical practice deals can greatly improve the process and outcome of a sale.
Even with the chilling effects of COVID-19, 2020 was the biggest deal year yet for private equity's investment in women's health practices (in terms of transaction count).