Q1 2025 Private Equity Update

Q1 2025 Private Equity Update

Private equity healthcare services displayed strong resiliency in Q1-25 in what otherwise can be characterized as an uncertain quarter, particularly related to tariffs, equity/debt markets, and recessionary fears. However, private equity investors remained focus and completed 42 platform transactions, led by 10 multi-site provider deals, nine home care deals, and eight pharma services deals. There were also several landmark exits in Q1-25 after record low exit volume in 2024. NexPhase exited SYNERGY HomeCare which was recapped by Levine Leichtman Capital Partners, and Court Square Capital Partners exited Knipper, which partnered with Frazier Healthcare Partners. Despite a resilient quarter, state-level regulatory filing and reporting requirements persist, and some states including New York are looking to expand its oversight on healthcare deals. If successful, it could pave the way for additional states to follow similar levels of disclosure, adding to the already scrutinized dealmaking process. Lastly, private equity investors continue to sit on over $1.2 trillion of dry powder, and the value of aging dry powder (four years or longer) increased to nearly 25% this quarter. GPs are eager to deploy capital, but consequently suggests that they are also struggling to find premier, affordable assets to invest in.

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