Earlier this month, we released a special report on M&A activity in the audiology and hearing aid industry. The report examines today’s buyer and seller activity, our outlook for the next 3-5 years, and an examination of some key trends impacting deals. To download the full report (for free), click here. The report intro is below:
As the third quarter of 2013 comes to a close, it’s time to take the pulse of M&A activity in the audiology and hearing aid industry. Earlier this year we noted in our Year End M&A Report: Audiology Industry that 2012 was a banner year for sellers, as corporate acquisitions continued to outpace sales to private individuals or other small practice owners by a wide margin, driving sky-high valuations while facilitating an exit during a favorable economic and tax climate. Now, as we examine how 2013 has unfolded thus far and we gaze into our crystal ball to predict what the future holds, we see that M&A activity remains strong in the face of changes that have had varying impacts on deal activity.
Last year, we estimated total transaction value of roughly $100 million, with $30 million worth of deals closing in December. While we expect the total number of transactions to decrease this year, there were two significantly large transactions in the first half of the year that will bring total value in 2013 in line with the previous year. We therefore predict another $100 million year.
Our estimates consider only the acquisition of privately owned audiology or hearing aid dispensing practices in the United States and do not measure transactions involving other entities within the industry. Furthermore, this figure only measures deals initiated in 2013. Many deals involve deferred payments, and millions of dollars will be spent covering obligations incurred from transactions that closed in previous years; however, in order to accurately assess deal volume for a given year, only transactions closed in that year can be measured.