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  • Cornestone Partners

Overview of mergers and acquisitions in the healthcare sector in Brazil

Updated: Apr 30

Check the main trends, transformations and how to prepare for future years


The healthcare sector has been going through a strong consolidation process in recent years. Since 2003, there have been 817 deals, placing the segment among the ten most transacted in the period, demonstrating a great appetite for mergers and acquisitions (M&A - Mergers and Acquisitions) . In recent years, around 500 transactions have been carried out in the sector, which together generated a turnover of almost R$90 billion (US$18 billion). Of this volume, around 90% were closed by ten consolidating groups — Rede D'Or, Intermédica, Dasa, DaVita, Hapvida, Fleury, Oncoclínicas, Sabin, Viveo and Hermes Pardini.

In 2022, companies in the healthcare sector, which include hospitals, clinical analysis laboratories and chemical and pharmaceutical companies, carried out 53 M&A operations across the country, according to data from KPMG. Despite a performance 36% lower than that observed in 2021, one of the main transactions ever carried out in Brazil was in this sector: the merger of Rede D'Or (RDOR3) and SulAmérica Seguros, generating a business valued at US$3.1 billion (or around R$15 billion).

What is the health market scenario?

Despite this relevant volume of transactions, the health market still maintains similar characteristics, with a concentration of health plan customers in a small group of operators and a hospital market that is still fragmented.

In 2021, around 75% of medical insurance users were from the Unimed, Hapvida, Bradesco, Amil or SulAmérica system. Furthermore, in some smaller areas there are still smaller operators with local relevance that could be targets for consolidation. In these areas, the hospital market is even more fragmented. According to BR Finance, around 130 hospitals (with more than 50 beds), located in cities with more than 200 thousand inhabitants, have already been acquired by large groups, but there are another 280 with these same characteristics still under the control of their founders.

In parallel, there is ongoing consolidation in the market for medical specialties such as ophthalmology, orthopedics, nephrology and reproduction. This movement began around 2015, but accelerated during the pandemic. In the ophthalmology segment alone, 30 transactions have been closed since 2021, the equivalent of one deal per month, according to a survey by Rio de Janeiro consultancy B2R.

The consolidation is led by private equity managers Pátria, which has already purchased at least 20 assets in the area, followed by XP, with around 15 deals closed. There are more than 5,000 ophthalmological clinics and hospitals in the country, indicating there is still room for growth.

What are the challenges in the healthcare sector?

Health is not a market that competes for the customer, it disputes the availability of providing the service to the population, since in this segment of the economy technology and services generate their own demand (Roemer's Law of Health Economics). However, many of the sector's challenges are:

● Due to its high investment cost, with high prices for equipment and


● Availability of professionals.

The use of artificial intelligence and remote reports are some of the trends that should boost it, with emphasis on advances in “healthtechs”.

In this panorama of mergers and acquisitions in the healthcare sector, the active role of private equity funds with experience in the healthcare sector stands out, such as Pátria, which invests in companies such as Dasa and Alliar; Vinci Partners, with investments in Cura; and Crescera Capital, with a history of investing in the healthcare sector, including Hospital Care, Hospital Vera Cruz and Hospital Baía Sul, among others.

How can we help?

In this sense, Cornerstone Partners is able, through the experience and experience of its professionals, to support healthcare entrepreneurs at all levels, in specialized consultancy services, valuation and advisory services for mergers and acquisitions , in the search for improving their governance. and analysis of business opportunities in the current scenario.

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