Private Equity acquisitions in healthcare increased for the fifth year in a row has been saved
Private Equity acquisitions in healthcare increased for the fifth year in a row
Healthcare & life sciences M&A research 2020
Since 2008, Deloitte Corporate Finance has been researching the developments in the mergers & acquisitions market in the Netherlands in the field of Healthcare and Life Sciences. This in-depth market knowledge ensures that we can assist our clients like no other in achieving their ambitions within the Healthcare and Life Sciences sector.
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- Limited number of restructuring transactions due to support packages
- Majority of acquisitions in life sciences sector
- Forecast 2021
- Executive summary
A number of the most interesting insights:
- The number of transactions by Private Equity in the healthcare and life sciences sector has again increased in 2020 compared to 2019, this year by 18%.
- The total number of transactions in healthcare decreased slightly, from 106 in 2019 to 96 in 2020.
- The number of international buyers has decreased, but remained the same in percentage terms at 36% of the total.
- The total value of merger and acquisition transactions in the healthcare and life sciences sector is estimated at €2.2 billion in 2020.
Limited number of restructuring transactions due to support packages
Dagmar Enklaar, Partner M&A Healthcare states: "We see that the total number of transactions in the healthcare sector has decreased slightly. This seems to be COVID-19 related and of a temporary nature. Acquisition processes have slowed down and due to the presence of support packages, restructuring transactions have been limited. Therefore, the impact of COVID-19 on the number of transactions is relatively limited."
Majority of acquisitions in life sciences sector
The life sciences sector accounted for 23 transactions and was therefore the segment with the highest number of transactions. Within this industry, most transactions took place within the Biotech companies (17 out of 23) and is therefore also the biggest riser with 5 transactions more than in 2019.
In a large number of subsectors, the number of transactions decreased slightly compared to last year:
- Healthcare suppliers: 18 vs. 24 in 2019
- Nursery homes/home care providers: 15 vs. 18 in 2019
- GGZ and other care providers: 16 vs. 18 in 2019
For 2021, Deloitte expects the number of transactions to increase again. Enklaar continues: "Due to COVID-19, the digitalization in healthcare has received a substantial boost, which has led to a lasting change in the market. Parties in the digital healthcare sector are expected to receive investments to further scale up."
A catch-up effect is also expected as a number of merger and acquisition processes have been somewhat delayed by COVID-19. There will also be restructuring transactions out of financial distress as a result of COVID-19.
International buyers will continue to account for approximately 35% of the total transaction volume. The number of transactions by international buyers will continue to be higher in the life sciences sector in comparison with the healthcare sector, as this market is internationally oriented.
The number of transactions by Private Equity will also grow in the coming year. Investors continue to have many funds available. There is a growing number of investors that focus, or want to focus, on the healthcare and life sciences sector because of its strong market foundation and from a diversification point of view.