Is the up, down activity in M&A finally over?


In this sneak peek of the M&A Insider that will appear in the October issue, The Braff Group looks at HME deal trends from 2006 to date.

As the firm notes in its analysis below, the last three quarters of activity have been relatively steady, with 15-18 deals per quarter.

What might that mean? Take in the graph and read analysis below for the full picture.

Based on proprietary data collected and analyzed by The Braff Group, after four quarters of deal flow bouncing up and down between Q4 2012 and Q3 2013, the home medical equipment sector has recorded three rather steady—and reasonably strong—quarters of M&A activity (15-18 deals per quarter). This may reflect a “settling in” of the market after the jarring announcements of competitive bid pricing for Round 2 and the Round 1 re-bid. As far as emerging trends, we note a somewhat anecdotal, but perhaps no less revealing, development. After repeated—and misguided—predictions of wide-spread Armageddon following each major reimbursement jolt over the past 20 plus years (rent-purchase, oxygen modality neutrality, the six point plan, OBRA ‘90, BBA ‘97, O2 caps), the doomsdayers may finally have gotten it right—sort of. For the first time since we’ve been covering the sector, we are beginning to hear more than just a few recordings of “this phone number is no longer in-service” as competitive bidding, somewhat predictably, is making the industry a bit less competitive. Where the sky-is-falling crowd continues to get it wrong, however, is the breadth of the retreat. Certainly some players that failed to earn bids have rolled in their wheelchairs.  But far more are tenaciously working the edges of the markets—from focusing on non-competitive bid products, to targeting non-Medicare beneficiaries—to keep their doors wide open.

If you want specific deal numbers per quarter, here they are:


Q1: 16

Q2: 18

Q3: 14

Q4: 12


Q1: 9

Q2: 15

Q3: 15

Q4: 6


Q1: 6

Q2: 12

Q3: 7

Q4: 10


Q1: 6

Q2: 16

Q3: 17

Q4: 10


Q1: 9

Q2: 8

Q3: 9

Q4: 11


Q1: 22

Q2: 18

Q3: 11

Q4: 17


Q1: 26

Q2: 16

Q3: 24

Q4: 27


Q1: 11

Q2: 20

Q3: 9

Q4: 17


Q1: 15

Q2: 18