The Australian healthcare industry continues to be a hot sector for investment in 2019. For healthcare business owners that are considering selling, it’s important to get your business sale-ready. This will allow you to get the best possible sale price.
If you’re interested in selling a healthcare business, talk to Nash Advisory. Our team are experts at valuing, buying and selling healthcare businesses, and facilitating deals that get the best possible results for our clients.
There is a strong demand for businesses in the healthcare sector, largely thanks to Australia’s ageing population, rising medical spend per capita and the quality of Australian healthcare services.
Both local and offshore investors have shown a strong appetite for a range of businesses across the Australian healthcare sector, including:
The strong demand for healthcare businesses translates to high sales prices. To demonstrate this value, have a look at some of the most recent transactions in the industry.
In the last 12 to 18 months, we have seen a diverse range of buyers seeking healthcare assets, including:
Healthcare buyers and investors are particularly attracted to healthcare companies that have:
For healthcare business owners that want to sell, the business must be sale-ready in order to attract a quality pool of buyers. This pre-sale preparation is vital, and importantly, should be commenced well in advance of starting any sale process.
Given the regulated nature of the healthcare industry, preparing healthcare businesses for sale can be more complex than other industries. Healthcare business owners should:
In addition to the typical steps which should be taken to prepare a business for sale, an owner of a healthcare business should also ensure that the business has:
In the healthcare industry, there are two prominent categories that have undergone recent mergers and acquisitions activity:
Below are some key considerations for potential sellers of these businesses.
Material contracts: Renew any key supplier, customer exclusivity or preferred provider agreements which are due to expire in the next 3 years.
Stakeholder consents: Prepare a plan for engaging with key customers and suppliers who require a change of control consent. Consents from government bodies can often take a long period of time.
Post-sale transition: The buyer may require the seller to stay with the business for a post-sale transition period (12 to 18 months). Sellers should plan accordingly.
Doctors and key medical personnel: Start pre-sale discussions to ensure that key employees and medical personnel will be staying with the practice following any sale.
To promote long term retention and protect relationships with patients, employees and key stakeholders, buyers may also require that:
IT and software: Replace outdated IT systems with industry leading platforms. This gives buyers the confidence that the business has strong advantages over competitors.
Best practice policies: As healthcare businesses are built upon patient relationships and reputation, it is important to ensure that a business’ services and patient treatment reflects best practice.This includes branding, service quality, patient experience and privacy.
Selling a healthcare business can be both lucrative and complex. At Nash Advisory, we specialise in achieving the best outcomes for our clients in the medical industry. Contact us, and let our team of expert advisers get the best result for you.