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3 things to know about healthcare M&A in 2016

Healthcare is expected to be one of the more active sectors in mergers and acquisitions this year, according to KPMG's M&A survey for 2016.

The survey collected responses from 553 executives and financial professionals from a variety of sectors, including 137 healthcare providers, health plans, pharmaceutical companies and medical device makers.

Here are three things to know about projected M&A activity.

1. Seventy percent of survey respondents expect technology to be the busiest sector for consolidation, followed by pharmaceuticals/biotechnology (60 percent). Healthcare providers are also projected to be the third most active sector for M&A (47 percent).

2. For 58 percent of healthcare industry respondents, large cash reserves will be the biggest factor to drive deal activity this year, according to the survey. Other reasons include improved consumer confidence (34 percent) and availability of credit (29 percent). Last year's survey found cash reserves (35 percent) and credit availability were the two main factors expected to drive deals.

3. When asked which factor will most inhibit deal activity in 2016, 42 percent of healthcare industry respondents cited a slow-growth environment. Thirty-two percent cited rising interest rates and 29 percent of cited availability of credit.

 

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