Merger and acquisition volume sees little change

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Merger and acquisition volume sees little change
Merger and acquisition volume sees little change

The first quarter of 2018 saw only one more publicly announced acquisition than the same quarter of 2017, according to new data from Irving Levin Associates.

Totals for those quarters were 77 and 76, respectively. Both numbers were higher than the 70 acquisitions that had been reported in the fourth quarter of 2017, however.

“Deal activity has been fairly consistent the past three quarters or so, with no major surprises,” said Steve Monroe of Irving Levin Associates. “Many investors are waiting on the sidelines for the right acquisition to come along, especially the large deals, which have been in decline in recent years.”

The dollar value of the first-quarter 2018 transactions was more than $1.7 billion, an increase of 20% from the same quarter in 2017 but a decrease from the fourth quarter, according to Irving Levin.

“Occupancy continues to trend downward across the spectrum, which has some buyers worried, but demand remains very strong for those transactions under $100 million, often yielding a dozen offers,” Monroe said.

In the first quarter, 85 senior living communities and 96 skilled nursing facilities were sold, according to the Norwalk, CT-based company.  Slightly more than 16,500 beds or units were involved, Irving Levin said, and the average price per bed and per unit were in line with 2017 averages.

Private operators accounted for approximately 43% of the acquisitions, with publicly traded operators announcing only three acquisitions in the quarter. Their limited activity on the buyer side has become typical, Irving Levin said.

Private equity firms and other private real estate buyers accounted for 34% of the acquisitions, with real estate investment trusts acting as buyers in 17% of the transactions.

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