Fitch Solutions released a a report titled "Small-Scale Bolt-On Deals To Be Core Focus of Medical Device 2019 M&A," detailing medical device mergers and acquisitions, examining the key trends in the field and what to expect in the future.
Five trends to know:
1. Private equity firms and investors have become more interested in the medical device space, which will influence future M&A. Globally, the expanding life span of the aging population and growing middle class in developing countries is attractive to investors.
2. Companies will likely continue expanding through M&A and diversify their product portfolios.
3. Fitch sees small tuck-in deals becoming more common as companies search for inorganic growth opportunities. Smaller tuck-ins can also supplement a company's research and development capabilities, with companies like Medtronic, Smith & Nephew and Stryker already making these deals in 2019.
4. Small tuck-in deals, which Fitch analysts think will become more prevalent in the second quarter, are attractive because they are typically low-value acquisitions allowing companies to cement their position within a market.
5. Large device companies including Johnson & Johnson and Smith & Nephew are acquiring surgical robots as a growth area in the future.