Leading the way: a review of recent healthcare deals

Peter Jennings Peter Jennings

Investors still consider healthcare as a growth sector, despite uncertainties following the recent election and the still unknown impacts of Brexit.

Social care sector under pressure

Evolving macroeconomic trends will underpin M&A activity in social care. Already significantly impacted by the National Living Wage, availability of staff post-Brexit is a major concern across the healthcare sector.

Some care providers who rely on government funding are struggling and some are looking to exit the market.

Many commentators suggest we are approaching a tipping point as bed shortages continue to reduce commissioner buying power.

Positive trends across the industry create unique investment opportunities

The outlook for specialist care and private pay providers remains largely positive with both markets attracting robust interest from both private equity and foreign investors alike.

Such activity is not limited to the specialist and private-pay providers. The pharmaceutical services market is also experiencing growth.

Through the process of outsourcing services, large pharmaceutical companies are continuously aiming to make drug research and development more cost efficient. This will create more opportunities for smaller specialist operators.

The medical devices market is another success story this year, attracting a great deal of interest from foreign investors. We recently advised on two transactions attesting to this interest, the sale of both Medisafe and Daniels Healthcare.

Macroeconomic uncertainty not limiting growth opportunities

Parts of the healthcare sector will undergo much turbulence and change in the coming year. Operators that are entrepreneurial and strive for innovation will undoubtedly attract the attention of investors who remain very active in the sector and see healthcare as a defensive sector in turbulent times.

Download our latest ‘Leading the way’ healthcare brochure to see the deals we advised on over the last 24 months.

For more information on corporate finance services in the Healthcare sector contact Peter Jennings.