Values Of Medical Equipment Deals Declined 25% In 2011

Tuesday 13 March 2012, Amsterdam

The “Medical Equipment Annual Deals Analysis 2012” report is an essential source of data and trend analysis on mergers and acquisitions (M&A) and financing in the medical equipment market. The report provides detailed information on M&A, equity/debt offerings, private equity (PE), venture financing and partnership transactions registered in the medical equipment industry in 2010. The report includes detailed comparative data on the number of deals and their value in the past four quarters, categorized into deal types, segments, and geographies. Additionally, the report provides information on the top PE, venture capital (VC), and advisory firms in the medical equipment industry.


Values Of Medical Equipment Deals Declined 25% In 2011

The medical equipment industry reported a decline in deal values in 2011 with $143.4 billion as compared to $191.9 billion in 2010, reflecting a decrease of 25%. However, the number of deals increased to 2,653 in 2011 from 2,452 in 2010. With more new companies entering in vitro diagnostics business in recent years, the market is able to attract investors’ focus. The market recorded 651 deals in 2011.


M&As In The Medical Equipment Industry Increased Marginally In 2011

Mergers and acquisitions (M&As), including asset transactions, recorded a marginal increase in the number of deals and a sharp decline in deal values in 2011. The segment reported 591 deals worth $68.6 billion in 2011, as compared to 581 deals worth $119.4 billion in 2010. Out of 591 deals announced in 2011, 472 were acquisitions worth $67.1 billion, 112 were asset transactions worth $1.5 billion, and seven were mergers with undisclosed deal value.

2011 recorded six high value M&A deals, which exceeded the $1 billion mark in deal value. Some of the major deals in 2011 included Johnson & Johnson’s announcement of acquisition of Synthes for $21.3 billion, Takeda Pharmaceutical’s acquisition of Nycomed for $13.7 billion and Thermo Fisher’s acquisition of Phadia for $3.5 billion.

According to Bhaskar Vittal, Analyst at GlobalData, “The deal activity is expected to increase further following improvements in the US economy and the significant cash majority of the leading healthcare companies are holding in their books.”


Capital Raisings Via Equity And Debt Offerings Decrease In 2011

Equity offerings recorded a decrease in the number of deals and deal values in 2011. The segment recorded 312 deals worth $7.6 billion in 2011, as compared to 316 deals worth $9.7 billion in 2010. Of the 312 deals reported in 2011, 32 were IPO deals worth $1.8 billion, 186 were PIPE deals worth $1.4 billion, and 94 were secondary offerings worth $4.4 billion.

In 2011, debt offerings registered 114 deals worth $41.4 billion in 2011, as compared to 105 deals worth $43.2 billion in 2010, reflecting an increase of 9% in the number of deals and a decrease of 4% in deal values. Out of 114 deals announced in 2011, 63 were public debt offerings worth $31.3 billion and 51 were private debt placements worth $10.1 billion.


Private Equity And Venture Financing Investments Increased 32% In 2011

Private equity (PE) and venture capital (VC) markets reported an increase of 32% in deal values in 2011. The market recorded deals worth $25.3 billion in 2011, as compared to $19.1 billion in 2010. The number of deals also increased from 846 in 2010 to 889 in 2011.

The rise in PE and VC investments could be due to increased exit activity, which allowed investors to achieve liquidity in their portfolios and re-invest the same in some new companies.

In venture capital market, start-up stage financing deals were the key driver. The segment recorded 408 deals worth $2.2 billion. Growth/expansion stage financing deals followed with 279 deals worth $2.7 billion, 93 later stage financing deals worth $1.5 billion and 44 seed stage financing deals worth $35m.

According to Bhaskar Vitta, an Analyst “PE/VC investment is expected to remain buoyant in the near future as growth opportunities continue to exist in markets such as IVD, cardiovascular and healthcare IT.”


Deal Values In North America Declined In 2011

North America reported a decrease in deal values with $87.4 billion in 2011, as compared to $121.1 billion in 2010. However, the number of deals increased to 2,021 in 2011 from 1,801 in 2010.

According to Bhaskar Vittal “The deal activity in terms of volume is expected to remain robust in North America in the near future following improvement in the US economy. The deal values may not increase proportionately due to investors valuing companies at lower levels, following uncertainties on reimbursement levels and healthcare reforms.”

Europe reported an increase in the number of deals and a decrease in deal values in 2011. The region reported 594 deals worth $50.8 billion in 2011, as compared to 561 deals worth $62.2 billion in 2010. The values in the region were down primarily due to sovereign debt crisis.

The Asia-Pacific region recorded an increase in the number of deals and a decrease in deal values in 2011. The region reported 343 deals worth $4.5 billion in 2011, as compared to 312 deals worth $7.5 billion in 2010.