The first quarter of 2025 saw only five hospital M&A transactions, a sharp decline from 20 and 15 deals in the respective first quarters of 2024 and 2023, attributed to economic uncertainty and policy changes. The second quarter experienced a slight increase with eight deals, but the average seller size dropped to $175 million from $984 million the previous year. The first half of 2025 had no mega mergers, resulting in a total revenue of $1.4 billion from M&A activity, far less than 2024's figures. Anticipation of increased activity exists for the second half of the year amid clearer financial challenges post-policy changes.
Hospital M&A transactions totaled only five in Q1 2025, a significant drop from 20 in Q1 2024 and 15 in Q1 2023, reflecting economic uncertainty.
The average seller size in the second quarter was $175 million, significantly lower than the previous year’s average of $984 million, indicating a trend towards smaller deals.
During the first half of 2025, zero mega mergers occurred, contributing to a modest total transacted revenue of $1.4 billion, down from $10.8 billion in 2024.
As hospitals navigate new financial challenges due to healthcare policy changes, there is potential for increased M&A activity in the second half of 2025.
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