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Consolidation Among Healthcare Staffing Firms Continues

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Staffing Industry Analysts (“SIA”) reported in December 2013 that the consolidation among healthcare staffing firms that began in 2012 was continuing in 2013.  According to Capital IQ, there were approximately 45 reported healthcare acquisitions in 2012 and 35 in 2013.

The primary reasons companies cited for making acquisitions included:

  • Adding capabilities, such as VMS;
  • Adding executive search to temporary staffing platforms; and
  • Divesting divisions to focus on their core competencies.

Some of the notable transactions included AMN Healthcare Services acquiring VMS ShiftWise in November; Jackson Healthcare acquiring Tyler & Company to add executive search to its capabilities; and Cross Country Healthcare divesting its clinical trial services business and then acquiring On Assignments’ allied healthcare staffing business.  On Assignment, for its part, seems to be beefing up its own focus on IT (recently acquired Apax Systems and Cyber Coders) and physician staffing.

This consolidation has come about as healthcare staffing firms finally started to experience an increase in demand, and wanted to be well-positioned to take advantage of growing demand in the sector that is forecast to grow at a compound annual rate of 5.8% between 2014 and 2022, according to SIA’s most recent staffing industry forecast.

So far in 2014, the consolidation trend has continued, with 6 transactions reported YTD through March 6th by Capital IQ, which compares to 1 in the first quarter of 2013 and 12 in the first quarter of 2012.  Some of the notable transactions include:

  • Acquisition of Fastaff Travel Nursing and U.S. Nursing Corporation (owned by Reliant Healthcare Professionals) by Healthcare Staffing Services
  • Japan-based private investment firm Mitsui & Co. acquired The Delta Companies, a provider of locum tenens in the US, to serve as their platform healthcare staffing acquisition
  • Levison Search Associates acquired by Jordan Medical Consultants, Inc.