INSIGHT

Q4-2018 Physician Services Update

During the fourth quarter of 2018, consolidation activity continued across physician specialties. Newer specialties to consolidation such as gastroenterology, orthopedics, and urology saw increased M&A activity. Within these specialties, organizations are leveraging private equity capital in order to execute acquisition strategies to consolidate other practices, expand ancillary service lines, and invest in corporate infrastructure. Central Ohio Urology Group partnered with New MainStream Capital to form the third private equity platform within the urology specialty. Florida Spine and Joint Institute and Precision Spine Care were both recapitalized by Trive Capital and Bow River Capital respectively; bringing the total count of private equity-backed organizations in the orthopedic specialty to six. The gastroenterology sector saw two transactions with Texas Digestive Disease Consultants’ recapitalization by Waud Capital and Atlanta Gastroenterology Associates’ partnership with Frazier Healthcare. With private equity interest continuing to accelerate across physician services, the space will benefit from increased competition during merger & acquisition processes, which will continue to drive strong valuations.

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Sources: SEC Filings; Company Press Releases, and Reports; IBISWorld; Capital IQ; PitchBook; PHP Estimates and Research. This document has been compiled with publicly available information. Provident Healthcare Partners, LLC makes no guarantee of its accuracy or completeness. No data or statement should be construed to be a recommendation for the purchase, sale, or retention of any security.