by Thomas Dworetzky
, Contributing Reporter | January 05, 2022
Nashville-based HCA Healthcare has closed on its deal to buy Florida-market urgent-care-provider MD Now Urgent Care. No financial terms were given.
The transaction boosts HCA Healthcare’s reach in the urgent care arena with the additions of MD Now's network of 59 urgent care centers in Florida. HCA now operates over 170 clinics across 19 markets.
“The addition of MD Now Urgent Care in Florida enhances our already strong capabilities in a rapidly growing state by providing convenient outpatient care options for our patients,” HCA Healthcare CEO Sam Hazen said in a statement. “It also connects MD Now patients to a comprehensive statewide network of care, including acute care and specialty services, should they be needed.”
The latest deal comes on the heels of HCA's announcement of plans to construct 3 more Florida hospitals — to better serve the 6.4 million patients each year that visit its more than 400 affiliated care sites across Florida.
The HCA buy is just one of a large volume of deals in the healthcare sector.
“Deal volumes rose by an extraordinary 56% [from 2020] in the 12 months through November 15, with particularly high growth in physician medical groups, managed care and rehabilitation subsectors,” according to a recent PWC report
on healthcare sector dealmaking.
The report underscored the interest in the sector, noting that, “deals appetite has persisted despite high multiples — the sector-wide mean enterprise value to EBITDA multiple for the period reached 15.2x.”
Deals in the period ended November 15, 2021, overall, numbered 1,773 for a total value of $203 billion. In 2020, by comparison, deals totaled 1138 for a total value of $62 billion. Since 2016, only 2017 came close to the 2021 totals, with 1031 deals worth $178 billion, according to the report.
In the year ended November 15, 2021, there were a number of “megadeals” in the sector worth $5 billion or more,” PWC added, including: four that involved contract research or manufacturing space, and Humana's acquisition of the rest of Kindred at Home, and two deals involved with the Walgreens Boots Alliance. These latter two were the $6.5 billion sale of Alliance Healthcare in June 2021, and its increased stake in VillageMD with a $5.2 billion investment
that raised its stake from 30% to 63%.
In addition, PWC observed that, “for years, there were no pure health services IPOs, but 2020 saw two, and 2021 has seen eight. This count excludes SPAC-backed IPOs, of which there have been at least a dozen in the 12 months through November 15 — of which two were classified as megadeals.”
The report advised that this level of growth in megadeals “indicates that deals will likely be plentiful going forward.”
In October 2021, another analysis of the healthcare market
, by Kaufman Hall, showed that there had been seven mergers and acquisitions in Q3 2021, worth a combined $5.2 billion. They included 20 hospitals and shows a trend toward bigger hospitals looking for partners to up finances in the face of pandemic-induced financial pressures.
"Larger health systems are looking to develop strategic combinations that broaden their reach moving forward, which includes developing initiatives to help overcome the adverse effects of COVID-19. Increasingly, these pursuits transcend traditional definitions of scale and market presence, and instead reflect the transformative importance of pursuing new business models, diversifying services, and succeeding in new models of providing care," Anu Singh, managing director and leader of the partnerships, mergers and acquisitions practice at Kaufman Hall, told HCB News at the time.