Introduction

We are pleased to share with you a summary update of market valuations and activities in the Asia Pacific healthcare industry (equipment and services) for the first half of 2020.

Healthcare is one the key sectors in which Armor specializes in and closely follows market trends. Please contact us for further discussions.

Valuations of Asia Pacific’s public companies have increased significantly over H1-2020 compared to the same period in 2019. Median EBITDA was 35.4x by the end of Q2-2020 vs. 18.7x in Q2-2019 – an increase of nearly 39% year-on-year. In addition, there has been changes in the top 50 constituents, reflecting movement in the competitive environment of the industry.

Based on 400-500 selected companies, the table above illustrates that industry returns and have been stable for the past 4 years, with a slight dip in the latest statistics. Similarly, industry margins have been lower in the latest statistics in comparison to the past 2 years.

M&A activity by volume has been lower over the past 2 quarters with 55-59 transactions (majority stake only) per quarter. The first half of 2020 had fewer mega deals compared to the second half of 2019, lowering the total transaction value for these 2 quarters.

Armor selected the largest M&A transactions across the region in H1-2020 for which information on Implied Enterprise Value and selected multiples were available. The data shows a wide range of multiples for acquisitions.