A recent report by Chicago-based Ponder & Co. states hospital M&A activity has decreased nearly 20 percent from the previous quarter.
According to the report, 16 hospital transactions were announced in the third quarter of fiscal year 2016, compared to 20 deals in the second quarter and 29 deals in third quarter of FY 2015.
Here are five more things to know about hospital M&A activity in the third quarter of 2016.
1. This quarter's deal volume was the lowest recorded activity since the fourth quarter of FY 2009.
2. Data complied by Ponder & Co. demonstrates a trend toward transactions involving hospitals with smaller revenue bases. The median revenue per transaction for the quarter was approximately $58 million, down from the 12-month median revenue per transaction of $149 million.
3. Analysts at Ponder & Co. expect divestiture activity to remain high through the end of the year and into 2017, especially as Franklin, Tenn.-based hospital operator Community Health Systems continues to divest assests.
4. Connecticut is the only state to witness multiple hospital transactions this quarter, despite the governor's extended moratorium on select transactions.
5. Despite the decline in volume this quarter, Ponder & Co. analysts acknowledge that the level of active discussions regarding potential transactions continues to increase.