The rise in private equity bankruptcies

More than 20% of the healthcare bankruptcies in 2023 were by private equity-backed companies, according to a new report from the Private Equity Stakeholder Project. 

Here are five key notes to know from the report. 

1. The report found that 17 out of 80 healthcare bankruptcies in 2023 were backed by private equity firms, in addition to 12 bankruptcies by companies with venture capital backing. 

2. Notable bankruptcies include Envision Healthcare, formerly backed by KKR; Air Methods Corp., backed by American Securities; and American Physician Partners, backed by Brown Brothers Harriman Capital Partners.

3. Almost all the distressed healthcare companies in 2024 are owned by private equity firms, according to the report, meaning another wave of bankruptcies is expected. 

4. There has already been one large private equity-backed bankruptcy this year. Cano Health, a value-based primary health provider, filed for bankruptcy in February.

5. The number of private equity healthcare bankruptcies has ballooned in recent years — in 2019, there were eight, marking a 113% increase.

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