Page 3 - Healthcare PE Pitchbook 34210
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Executive summary
Executive summary
Last year, private equity-backed healthcare activity surged with more than And consider the personnel and human capital needs when converting
300 transactions cumulatively valued at an estimated $80 billion. Lockton a small, locally owned practice into a large, multistate, M&A-fueled
was fortunate to have a front row seat and has been a major benefactor to healthcare provider organization.
the recent rise in healthcare deal low. Consequently, our private equity and
healthcare specialty practices are well-seasoned and intimately familiar Lockton views these obstacles as opportunities. We’ve long established
with both the opportunities and the challenges, from entry to exit. a team of M&A transaction experts specializing in commercial insurance,
employee beneits, and transaction liabilities. Lockton compliments
The cost of healthcare or “trend” is increasing 5% to 10% each year. our pre-close due diligence resources with industry-leading post-close
Domestically, our population is older, less healthy, and more insured than consulting services.
ever before. And the demands of consumers are changing. Specialization
and affordability are essential. Each private equity healthcare client is assigned to our dedicated
healthcare service group of insurance and beneits professionals who
The demand is undeniable, yet the supply of healthcare service providers bring decades of industry knowledge and experience. In addition to core
continues to lag is markets across the country, creating a highly competitive risk management and human capital consulting competency, Lockton’s
situation and leading to incredibly high valuations. Larger, publicly traded healthcare teams are adept to dealing with issues pertaining to the
enterprises are shedding unwanted or underperforming divisions. Smaller, corporate practice of medicine, multiple employer welfare arrangements
privately-owned practices are eager to take advantage of the seller’s and multi-employer plans, controlled group and NCCI combinability
market. determinations, and more.
As a result, private equity is trending away from larger regional platform In the pages that follow, allow us to take a deeper dive into Lockton’s
investments and turning towards smaller, locality-focused, lower- expertise in the area of private equity and healthcare. We hope you ind this
middle market opportunities with a buy-and-build mentality. Through information useful and would welcome the opportunity to explore whether
consolidation, this approach can unlock economies of scale not otherwise Lockton could bring any added value to you and your portfolio.
available to smaller practices and provide resources to execute other, more
sophisticated cost-containment strategies. Add-on investments are far Thank you,
outpacing new platform acquisitions.
This investment strategy is not without its challenges. Consider the cultural
and political nuances of harmonizing several smaller practices, most of
which will have enjoyed their past autonomy and lack of oversight. Consider Dan Leary
the accelerated pace in which private equity inluences changes upon these Partner, Executive Vice President
enterprises in those early years and associated risks.
Lockton Private Equity/Healthcare pitchbook 3 Lockton Companies
Executive summary
Last year, private equity-backed healthcare activity surged with more than And consider the personnel and human capital needs when converting
300 transactions cumulatively valued at an estimated $80 billion. Lockton a small, locally owned practice into a large, multistate, M&A-fueled
was fortunate to have a front row seat and has been a major benefactor to healthcare provider organization.
the recent rise in healthcare deal low. Consequently, our private equity and
healthcare specialty practices are well-seasoned and intimately familiar Lockton views these obstacles as opportunities. We’ve long established
with both the opportunities and the challenges, from entry to exit. a team of M&A transaction experts specializing in commercial insurance,
employee beneits, and transaction liabilities. Lockton compliments
The cost of healthcare or “trend” is increasing 5% to 10% each year. our pre-close due diligence resources with industry-leading post-close
Domestically, our population is older, less healthy, and more insured than consulting services.
ever before. And the demands of consumers are changing. Specialization
and affordability are essential. Each private equity healthcare client is assigned to our dedicated
healthcare service group of insurance and beneits professionals who
The demand is undeniable, yet the supply of healthcare service providers bring decades of industry knowledge and experience. In addition to core
continues to lag is markets across the country, creating a highly competitive risk management and human capital consulting competency, Lockton’s
situation and leading to incredibly high valuations. Larger, publicly traded healthcare teams are adept to dealing with issues pertaining to the
enterprises are shedding unwanted or underperforming divisions. Smaller, corporate practice of medicine, multiple employer welfare arrangements
privately-owned practices are eager to take advantage of the seller’s and multi-employer plans, controlled group and NCCI combinability
market. determinations, and more.
As a result, private equity is trending away from larger regional platform In the pages that follow, allow us to take a deeper dive into Lockton’s
investments and turning towards smaller, locality-focused, lower- expertise in the area of private equity and healthcare. We hope you ind this
middle market opportunities with a buy-and-build mentality. Through information useful and would welcome the opportunity to explore whether
consolidation, this approach can unlock economies of scale not otherwise Lockton could bring any added value to you and your portfolio.
available to smaller practices and provide resources to execute other, more
sophisticated cost-containment strategies. Add-on investments are far Thank you,
outpacing new platform acquisitions.
This investment strategy is not without its challenges. Consider the cultural
and political nuances of harmonizing several smaller practices, most of
which will have enjoyed their past autonomy and lack of oversight. Consider Dan Leary
the accelerated pace in which private equity inluences changes upon these Partner, Executive Vice President
enterprises in those early years and associated risks.
Lockton Private Equity/Healthcare pitchbook 3 Lockton Companies
