Private equity sellers are taking advantage of the high-multiple environment in the healthcare market by exiting whenever possible, creating steady deal flow in the sector, according to Ira Coleman, partner at McDermott Will & Emery's Miami office and head of the Miami Health Industry Advisory practice.
Here are five things to know about deal volume and exit activity in private equity healthcare.
1. Exit activity in 2013 for healthcare buyouts reached a high for the decade, jumping 34 percent compared with 2012 to reach 133 transactions, according to a Bain & Co. report.
2. Exit conditions remained favorable in 2014, and strong equity markets made initial public offerings increasingly popular, according to a report by Bain & Co.
3. Mr. Coleman said healthcare deal flow, especially on the exit side, will stay busy for at least the first half of next year. "Everyone was selling everything they could this year. This should continue for at least a quarter or two in the next year," said Mr. Coleman in a statement.
4. Private equity sellers have also been successful exiting their healthcare companies via IPOs.
5. In the first nine months of this year, healthcare was the leading U.S. sector by IPO proceeds, accounting for 23 percent of capital raised in that period, according to EY.
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