8 trends in healthcare mergers & acquisitions for 2017
Capital One released its annual survey on merger and acquisition activity, illustrating what to expect in the year ahead.
More than 450 healthcare executives responded to the survey.
"With M&A and a strong new business segment outlook, executives are clearly keeping all avenues to growth on the table," said Al Aria, senior managing director of Capital One Healthcare. "As capital needs rise, it's critical that companies find a financial partner that understands the healthcare marketplace."
Here are eight trends from the report:
1. Thirty-one percent of executives plan to launch new segments or business lines to drive growth, up from 17 percent last year.
2. Thirty-eight percent of the executive respondents report merger and acquisition transactions are driving their growth plans for 2017, a drop from 41 percent last year.
3. Twenty-six percent of the respondents who said M&A activity would drive their growth in the comping year reported organic growth initiatives as their top strategy.
4. Almost half of the respondents said they expect capital needs to rise in 2017 and 42 percent expect they'll require more capital in the year ahead; 25 percent said the same last year.
5. More than half — 59 percent — of the respondents said ACA changes were their chief concern for 2017, up from 33 percent last year.
6. Eighteen percent of the respondents said regulatory uncertainty was their top challenge for the year, where 33 percent said the same.
7. Ninety-four percent of the executives reported their business is expected to have a financial performance on par with last year or better.
8. Sixty-one percent of the respondents predict a stronger year in 2017 than 2016; 7 percent anticipate a weaker financial year in 2017.
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