GCG’s Q1 2021 Healthcare Industry Update provides an overview of the latest trends in the sector, including recent performance, valuation multiples and the state of the middle-market M&A environment.
Key findings include the following:
- Q1 2021 M&A activity displayed an increase in transaction values and volume over the previous three quarters. Middle-market Healthcare deal volume and average deal value have both reached highs over the past four quarters with 1,421 transactions completed and an average deal value of $145 million, showing that there is an ongoing recovery in the M&A market.
- Strategic buyers continue to dominate overall deal activity and have sought acquisitions to improve access to healthcare and scale existing platforms, while reducing costs and create long-term strategic and operational improvements.
- The Medtech category led activity, accounting for 20.9% of total Healthcare transaction volume. The Biotechnology sector proved to be an attractive target as well with 20.7% of deal flow.
- Based on a representative set of publicly traded companies in the Healthcare industry, public companies traded at an average multiple of 15.2x EBITDA and 3.7x revenue. Additionally, one of the strongest sectors in the Healthcare industry was Homecare/Hospice with an average multiple of 21.5x EBITDA. Staffing/Services also performed well as of LTM Q1 2021, recording an average multiple of 14.9x EBITDA.
Click here for the full update.