M&A firm on DME: It's still an attractive market

Monday, June 1, 2009

LOS ANGELES – The durable medical equipment industry is headed for an “eventual rebound,” according to American HealthCare Capital, a mergers and acquisition firm based here.

“The durable medical equipment and respiratory segments continue to be impacted by challenges such as competitive bidding, rental caps, rate cuts and now the implementation of a new surety bond requirement,” it states. “(But) operators who are committed to the industry for the long term are still making strategic acquisitions to position themselves for an eventual rebound. Weaker providers who have not adapted to changing conditions can be bought at discounted prices.”

American HealthCare Capital’s comments on DME were part of its second quarter healthcare industry outlook.

Overall, healthcare maintains steam, according to American HealthCare Capital, even as the economy searches for the bottom.

“Difficult economic conditions and potential regulatory changes pose challenges for healthcare providers, but the promise of sustained long-term growth across the healthcare services industry continues to attract investment in successful companies that can capitalize on the need for services across the full continuum of care,” it states.

American HealthCare Capital points out that it has closed more transactions in the first quarter of 2009 than it did in for the same period last year.

To read the full outlook, go to: