Mergers & Acquisitions
Updated: January 18, 2022
- There were 17 hospital deals announced during the fourth quarter, an increase from the previous quarters. For the year as a whole though, the 53 deals completed represented the lowest level of activity in more than 13 years. Transaction volume is expected to rebound in 2023 as pressure mounts on hospital operating margins, investment portfolios decline and the threat of defaults looms.
- Average transaction size measured by revenue ballooned to more than $1 billion, nearly doubling the previous annual record. That average deal was heavily weighted by Advocate Aurora Health and Atrium Health, which completed their merger in December, forming a $27 billion system with 67 hospitals across six states. The combined system, Advocate Health, is based in Charlotte, North Carolina.
- Lansing, Michigan-based University of Michigan Health said in December that it would acquire the six-hospital Sparrow Health System, which is also based in Lansing. If the deal goes through as expected in the first half of 2023, pending customary regulatory approvals, University of Michigan would expand to a $7 billion, 11-hospital system.
- Duluth, Minnesota-based Essentia Health and Marshfield (Wisconsin) Clinic Health System signed a memorandum of understanding to merge in October. The combined system would have 25 hospitals across Minnesota, Wisconsin, Michigan and North Dakota.
About the Transaction Data
Ponder & Co. records transactions upon announcement of a definitive agreement, or letter of intent if the transaction involves a for-profit system. If no announcement was made prior to closing of the transaction, the effective date is recorded.
Deals are divided into three groups based on the most recent estimated revenue of the targeted firm:
Large = More than $1 billion in estimated revenue
Medium = $100 million to $1 billion
Small = Less than $100 million
Transactions by Quarter
Small, medium and large deals by estimated total revenue of targeted entity.
Largest Deals - Q4 2022
Largest Deals - Full Year 2022
2022 recorded lowest announced change of control activity in recent history.Download
Annual “third quarter slump” further mutes already depressed announced transaction volume.Download
Continuing low levels of announced hospital transaction volume marked by several notable major mergers and reorganizations.Download
Moderate pace of announced change of control transactions continues led by for-profit divestitures.Download
Sources and Methodology
M&A data on this page is provided by Ponder & Co.
Ponder & Co. is a healthcare finance and strategic advisory firm focused exclusively on providing leading capital advisory, mergers & acquisitions, strategic advisory and management consulting services to not-for-profit hospitals and healthcare systems. With 45 years of experience in healthcare and integration, Ponder & Co. has perfected the art of objective advice, and the science of skilled transaction, to bring seamless financial, strategy, and organizational transformation services to their healthcare clients.
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