The first quarter of 2021 delivered 38 reported behavioral health transactions, an increase over any quarter in 2020. We expect some of this activity reflects deals that were delayed due to COVID-19. However, we generally expect high deal flow throughout 2021, supported by increasing private equity interest, a favorable government, and a seller pool that is ready to transact.
Designed to help physician owners considering a sale to private equity, this paper examines the key questions common to our initial client conversations. The learnings apply to all practice verticals from ophthalmology .. to gastroenterology .. to dermatology. Topics include: The Best Time to Sell, Determining the Best Buyer, The Private Equity Investment Model, Calculating Adjusted EBITDA for Medical Practices, Practice Valuation and Multiples, How to Get Associate Physicians to Buy-in.
The FOCUS healthcare team represents medical practices and ancillary businesses in specialties where private equity-backed consolidation is occurring. We track activity in key verticals and maintain strong relationships with private equity firms and their portfolio companies.
A comprehensive view of ophthalmology's recovery from the pandemic shutdown. We review changes in elective surgery, the emerging investor interest in retina practices, private equity acquisition activity, geographic development, and changes to acquisition practice size. As the COVID-19 fog begins to clear, we see significant near-term promise and a potential return to record deal levels.
After seven strong years, private equity investment in dermatology has been in decline since 2019. Now, elective procedure bans and shelter-in-place orders have practice owners wondering if the opportunity to sell has passed. This paper examines the differing views on pe-backed consolidation, key performance indicators, investor activity, and saturation by geography and practice size. We see several positive factors for our current and potential clients within a coming private equity player restructuring.
Is gastroenterology the next darling of private equity? Large GI practice acquisitions exploded in 2019, tripling that of the prior three years. Expansion to new geographic areas doubled in each of the last three quarters of 2019. We see this activity accelerating in 2020 when a significant number of new private equity investors enter the market and physician sellers see high demand for their practices.
Private equity investment in ophthalmology practices has been one of the "hottest" sectors in M&A over the last several years. We believe the market will continue to be strong but our key indicators now signal a transition to Network Growth in 2020 – a more mature phase characterized by consistent add-on acquisitions. There are still open geographies with great opportunity, such as Texas and multiple areas on the West Coast. We project increased deal activity in these areas including large platform acquisitions.
White Paper: The Physician Sellers Guide to Private Equity Firms Investing in Orthopedics – April 2019
Private equity investment in orthopedic practices is in the early pioneering stage. Twelve private equity firms have participated in major orthopedic and spine practice investments … 6 as LEAD investors and 6 as participating investors. We examine the six lead investors to understand their investment strategy, current geographic footprint, and growth prospects. We also discuss the five issues we believe will drive the future growth of private equity investment in orthopedics.