The behavioral health care M&A market dropped in the third quarter of 2019, down 35% with 17 publicly announced transactions compared with 26 acquisitions in the second quarter, according to data from HealthCareMandA.com. Compared with the third quarter of 2018, behavioral health care M&A activity also declined 35%, when 26 acquisitions were announced. There were only two transactions with a disclosed price this quarter, for a combined $14.2 million.
Private equity firms and their portfolio companies once again dominated the sector as buyers, accounting for 76% of the announced transactions. “We’re seeing a new wave of exits as the smaller platforms are being rolled up into regional platforms, almost regardless of their focus,” said Lisa E. Phillips, editor of The Health Care M&A Report, which publishes the data. “With demand for all aspects of behavioral health services growing, particularly autism and substance abuse programs, we expect to see a healthy level of activity into 2020.”
Two PE-backed companies announced two acquisitions apiece in the quarter. Kadient, backed by TPG Capital, acquired two companies focused on autism spectrum disorders, in California and Ohio, and The Family Treatment Network, owned by Pharos Capital Group, acquired two agencies in Florida. Acadia Healthcare, which had drastically slowed its M&A activity in the past two years, announced the acquisition of Bradford Recovery Center in Pennsylvania.
All quarterly results are published in The Health Care M&A Report for all 13 sectors of health care, which is part of the HealthCareMandA.com investment research source. For information, or to order the report, call 800-248-1668. Irving Levin Associates is celebrating more than 70 years of delivering exclusive M&A intelligence to its sophisticated audience of seniors housing and healthcare investors. The company was established in 1948 and has headquarters in Norwalk, Connecticut. The company publishes research reports and newsletters and maintains databases on the healthcare and senior housing M&A markets.