Physical therapy M&A still warming up
Illustration: Sarah Grillo/Axios
Physical therapy chains are facing tight labor constraints and cost pressures, but the business continues to attract investor dollars.
Driving the news: Partners Group-backed Confluent Health acquired Motion Physical Therapy from Pharos Capital for between $200 million and $250 million, sources tell Axios.
State of play: The market has had steady M&A activity, both at the platform and roll-up level.
- Waud Capital-backed Ivy Rehab, New Jersey's largest physical therapy provider, acquired Excel Physical Therapy this week for an undisclosed price.
- Lindsay Goldberg sold PT Solutions to General Atlantic for about $1.2 billion last year, Axios reported then.
- THL Partners launched an auction for ProPT last year via Jefferies, Axios reported, though sources tell Axios the process may be on hold.
Yes, but: ATI Physical Therapy, which went public via SPAC merger at a valuation of about $4 billion in 2021, has yet to hit profitability and its share price has dropped steadily over the last 18 months.
- In November 2022, ATI received formal notice from the NYSE of noncompliance with continued listing standards.
Meanwhile, after acquiring Pivot Health Solutions for $550 million in 2021, BDT-backed Athletico reportedly launched $875 million term loan B to refinance its debt and pay for the acquisition.
Zoom out: Given labor pressures, capital is also flooding into digital health entrants that don’t rely on traditional clinics. For example:
- Commons Clinic in December raised $11 million in seed funding as it looks to build the One Medical for specialty care.
- In-personal physical therapy clinic operator Bardavon in June acquired virtual-first MSK startup PeerWell for 8 figures.
- Virtual MSK provider Sword in November 2021 clinched $189 million in Series D capital steered by Sapphire Ventures at a valuation of $1.8 billion.
- Hinge Health, another digital MSK company, in October 2021 soared to a $6.2 billion valuation after raising $600 million in Series E funding led by Coatue and Tiger Global.
THL declined to comment on ProPT.
