Spotlighting 2Q IT and Healthcare Activity in U.S.
August 07, 2014
IT deal flow remained steady in 2Q. About $17 billion of PE capital was invested through 89 transactions, with both figures in line with previous quarters. The software segment of the industry is particularly active, with 2014 on pace to surpass the annual deal flow totals of any year following the financial crisis. Software has become industry-agnostic in some respects, as everything from colleges to hospitals to industrial conglomerates have incorporated software solutions into their operating models. For PE investors, software providers offer strong recurring revenue streams and also boast greater add-on potential for platforms.
On the healthcare side, PE interest in the sector remains high, but frothy valuations and strong deal-making competition from the corporate world have muted PE deal flow. Fifty-four transactions were completed in the industry in 2Q for a combined price tag of $14 billion. PE investors are particularly active in the healthcare services and provider-based care segments, both of which help reduce the overall costs of delivering healthcare.
More insight and in-depth information on PE investing in the IT and healthcare industries in 2Q 2014 can be found in the Private Equity Deal Flow Profiles published by McGladrey. Powered by PitchBook, the reports include current industry trends, deal activity and exit activity, as well as several insights from McGladrey professionals.
To access McGladrey's quarterly PE reports page, click here.