The prospect of growth that accompanies the M&A market in 2023 has also been bringing positive effects in the health area, driven by the large number of transactions that have taken place in recent years.
In 2021 alone, according to a survey by Valor Econômico newspaper, mergers and acquisitions in this sector injected around R$15 billion into the economy, from negotiations involving large groups. But what can we expect for this year? Keep reading and learn more.
The boom of recent years.
The crisis brought about by the pandemic has turned into a series of opportunities for M&A operations for the health sector, which has experienced a growth in the number of transactions. Several publications at the time highlighted this increase and placed this market as the leader in the ranking of mergers and acquisitions between 2021 and 2022.
Speaking of numbers, of the nearly 2,000 mergers and acquisitions that took place in 2021, 114 were between hospitals, laboratories or other companies in the field, according to data collected by the Mergers & Acquisitions website, representing 6% in that year’s chart.
Despite being less intense in statistical terms — with 35 fewer transactions and around 4.3% of the number of transactions — , the following year was also marked by important negotiations in the healthcare market, which placed large companies, such as Rede D’or and Sulamérica, in addition to Fleury and Pardini.
At the end of 2022, all expectations related to 2023 were very encouraging, especially in the area of diagnostic medicine, driven by the desire of companies to expand their operations geographically, according to the global consulting firm Kroll, told Valor Econômico in a report at the time.
It is time to consolidate.
The healthcare market remains fertile in terms of mergers and acquisitions, however, the expected direction for this year is not a record of transactions, but the consolidation of negotiations that took place on a large scale, especially from 2021 onwards.
What does that mean? That companies should remain attentive to opportunities that arise, but will have a greater focus on the post-acquisition and on the integration process between companies that have gone through an M&A transaction.
For many of them, the appetite for new transactions must be reversed in the search for synergies, with the aim of making all the amount invested in recent years worth it and formatting new business paths after the unification between the health organizations in question.
The Info Money website brought some examples that help to illustrate this panorama, as is the case of Viveo. The drug distribution company reduced its number of acquisitions from 19 to 12 and now aims to put the solidification of all these investments that were made at the tip of the pencil.
Despite the cooling trend in the number of operations, this is far from signifying a market retraction or a shrinkage of the sector. The health area remains promising, however, we can expect more strategic and specific negotiations.
Recently, for example, the Fleury group felt the need to expand its services and, to that end, acquired all the quotas of Retina Clinic for more than 20 million reais.
How many M&A transactions have occurred in the healthcare sector this year?
Mergers and acquisitions continue to happen in all areas and healthcare companies are no different. Even at a more moderate and cautious pace, the negotiations that have taken place so far show that there is still room for growth and that, by the end of the year, there is the prospect of new important transactions for this market.
In January, according to the Mergers & Acquisitions website , there were five operations between hospitals and laboratories, occupying fifth place in the ranking. In February, that number grew to eight and the sector rose two positions. In March, there were seven transactions and one placement less in the list.
Among the businesses that have been consolidated so far, we can highlight the purchase of Promédica by Danone — with the aim of strengthening its nutrition department — and the acquisition of almost 30% of Sorridents by Fundo Crescera.
The health sector continues to have great business possibilities and opportunities for expansion from mergers and acquisitions are always emerging, but to help you map them out, the best decision is to look for an Advisory company, for a consultancy specialized.
