DealScape | Healthcare Services M&A: Stabilizing, but Still Strategic
The Q2 healthcare services M&A market didn’t fully rebound, but it has stopped sliding. For founders and investors, conditions remain workable, provided the sale process is carefully positioned.
Key Market Dynamics
Private equity still active in targeted areas
Sponsor interest remains strong in home-based care, behavioral health, dental, and veterinary services, particularly where there is scalable infrastructure and a compelling growth story. Add-ons continue to drive most transaction volume, though standout platforms are still getting done.
Exit activity remains steady
Roughly 15 larger PE exits closed last quarter, showing that the exit market, while selective, remains open for quality assets.
Regulatory scrutiny is intensifying
State-level oversight is reshaping deal execution. Oregon recently passed the nation’s most aggressive law limiting MSO involvement in clinical practices. Massachusetts and Pennsylvania are also broadening transaction review authority and redefining material changes of control.
For founders operating under an MSO structure and considering a sale in the next 12–24 months, this is the time to assess regulatory risk exposure. Buyers are scrutinizing clinical autonomy, fee-splitting, and governance alignment more closely than ever.
Valuation gap widening
Top-decile assets still command premium multiples. But average businesses face longer deal cycles, tougher diligence, and sharper buyer focus on margin durability and growth visibility. What was “good enough” no longer clears the bar.
What This Means for Sellers
Strong outcomes remain achievable, but only for practices and MSOs that enter the market with:
A clean financial story
Robust compliance infrastructure
A sharp, defensible growth narrative
In this environment, process design and buyer selection are just as important as valuation.
If you’re weighing timing, buyer appetite, or how your MSO model will hold up in diligence, our team can provide perspective on how to best position your business for a successful outcome.