2022: Reason for optimism
In many ways, 2021 appears at first glance to have been a false dawn. Far from being put to the sword by vaccines, Covid is still very much with us and still the topic on everyone’s lips, and rightly so. And yet there remain reasons for optimism in the market.
The HBI Pipeline enables HBI Intelligence and Connect members to see which groups hold which assets, and how likely these are to sell. Click here to see more.
Because while the vaccine rollout has been, at best, patchy, with rich countries buying up the majority of the supply, there is a growing understanding that while the pandemic is here to stay and the battle against it continues to be fought, there is still a lot of business to be done and a way to do it. And in that respect, after 2020 saw many a deal put on hold or put back, 2021 has seen the market turn a corner.
We know that, particularly for smaller groups in more vulnerable subsectors, the effect of lockdowns, Covid precautions and staff absences have been keenly felt. And yet, pretty much all through 2021, HBI’s inboxes have been full of prospective deals and our phones have been ringing to the tune of a more optimistic market, a sentiment we confidently expect to continue into 2022. Rather than the post-pandemic euphoria and lift we might have hoped to see, there is instead the sense that operators understand the challenges in this new landscape, there remains a lot of dry powder, and there is also a sense that bigger is better (and safer), which is strongly driving consolidation in many sectors.
2021 saw the strongest healthcare M&A market in memory according to managing director at Rothschild & Co and HBI 2021 keynote speaker Hedley Goldberg – with healthcare deal activity expected to end at an all-time high (albeit that services were not at the very forefront of that peak).
And looking at the deals pipeline for 2022 (HBI Intelligence members can see HBI’s Deals Pipeline here), it looks strong into next year, as the weight of liquidity drives investment into healthcare despite clear inflationary risks.
HBI’s experience certainly bears this out. Our stories this month about the likes of Unilabs, Centene and Affidea, and our earlier recent exclusives about Veonet, Rodericks, and Alloheim, suggest this is very much a market with an appetite to do deals. And the groups that everyone has been talking about this year – as you can see here from searches on our website – are those looking to cut a deal. If you haven’t done so already, why not take a look and see if you (or your rivals) made the cut?
HBI is closing down for a small Christmas break now, but will be back in the new year to bring you all the insights, deals, and business intelligence we can muster. To those of you taking a break too, we wish you a peaceful new year and hope you have time to recharge your batteries. The signs are next year could be busier than ever.
We would welcome your thoughts on this story. Email your views to David Farbrother or call 0207 183 3779.
