Who's buying PT practices right now

The short answer

Who is buying physical therapy practices today, and what does it mean for you? The acquirer pool is deeper than most owners realize. Paul Martin, Founder and President of Martin Healthcare Advisors, breaks down the three types of acquirers.

The three acquirer types:

1. Large privately held PT companies: fewer transactions, less capital than PE-backed groups, but they often behave differently and can be the better fit for the right business
2. Strategic acquirers backed by private equity: the large majority of transactions today, often still led locally and regionally by physical therapists, with the ability to offer a "second bite of the apple" through rollover equity
3. Family offices: a wealthy family investing its own money across many businesses, not building a PT platform

Full transcript

Right now, the acquirer pool for physical therapy practices is deeper than most owners realize, and there are three types in it today.

First is the large privately held companies. Transactions with these companies are rarer than most owners think, primarily because these companies do not have the kind of capital that private equity backed companies will have. That being said, they will commonly behave very differently compared to an acquirer that is backed by a financial partner, and that becomes a better choice for the right company and the right owner.

Second, strategic acquirers backed by private equity. This is the large majority of what is transacting today. These companies have strong financial backing, and many of them continue to be led at a local and regional level by physical therapists. They have significant access to cash and can traditionally give physical therapy business owners a very strong second bite of the apple, with a mechanism called rollover equity.

And third, family offices. Think of a wealthy family investing its own money, not a fund raised from outside investors. Traditionally, they spread that money across a lot of different businesses. They're not buying one physical therapy company and scaling it into a platform like the private equity firms would do.

Transcript lightly edited for readability.