Leading Bankers See Strong Year for Healthcare, M&A Activity

Representatives from top investment banking and private equity firms predicted a strong year for healthcare and more mergers and acquisitions of healthcare organizations, according to a release by the Nashville Healthcare Council.

Representatives from Morgan Stanley, Goldman Sachs, Oak Investment Partners and UBS Investment Bank spoke at the council’s annual “Financing the Deal” panel discussion. While speaking about healthcare companies in Nashville, their comments applied to the national environment, where many of those companies operate.

Panelists said M&A activity would increase as healthcare organizations seek to expand services, increase transparency, lower costs and improve quality. They also pointed to great promise for healthcare IT providers to help hospitals and physician practices aggregate healthcare data and create intelligent, usable information for physicians and patients.

Here are some quotes from the panelists.

“We have seen a tremendous snap-back in the financial markets,” said Andrew Bhak, managing director at Morgan Stanley. “It looks like it is going to be a very strong year.”

“It is a fantastic time to be an entrepreneur and own or run a business,” said Raheel Zia, managing director of the Merchant Banking Division at Goldman Sachs. “There is a lot of capital in the healthcare market and a lot of interest in the market from non-healthcare investors on the venture and private equity side.”

“Healthcare reform is propelling an explosion of new opportunities,” said Annie Lamont, managing partner at Oak Investment Partners.

“One of the key themes in healthcare these days is the shift from a payor-centric environment to provider-centric one,” said Rob DiGia, global head of Healthcare Investment Banking at UBS Investment Bank. “I think you will see a number of other companies as well as M&A transactions that will play on this theme. The market is starved for healthcare services.”