Lincare joins Rotech, AeroCare on M&A trail

Friday, February 13, 2015

CLEARWATER, Fla. – Lincare keeps things close to the vest, but the provider is rumored to be on the acquisition trail.

“I’m hearing they are starting to accelerate on doing some acquisitions, for sure,” said Rick Glass, president of Steven Richards & Associates.

In December, Lincare acquired the DME business of Stevens Point, Wis.-based Ministry Health Care; in June, the provider acquired the DME and respiratory business of Wright & Filippis.

When “Lincare is one of the only companies around that can absorb these businesses that haven’t been able to make the transition to the new reality of reimbursement,” said Glass.

Lincare was acquired by Linde for $4.6 billion in 2012, CEO John Byrnes said the company would reduce its locations by about 100 and that it would focus on growing organically rather than through acquisitions.

Now it appears the provider, which holds multiple competitive bidding contracts, is looking to make strategic acquisitions, say analysts.

“They’ve pushed their M&A activity out into the field where they see a lot of opportunity,” said Jonathan Sadock, managing partner/CEO of Paragon Ventures. “Some of those opportunities are smaller, but I think it’s more strategic coverage-wise, rather than getting scale.”

With so much of the uncertainty related to the competitive bidding program gone, Lincare could face some competition from a couple of other companies that had also been dormant on the buying front: Rotech Healthcare and AeroCare. Rotech has made three acquisitions since December and has announced plans for more. AeroCare in January acquired Plant City, Fla.-based Matrix Medical, which Lincare was also said to have been interested in.

“AeroCare won that battle,” said Glass.