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Merger And Acquisition Framework Analysis In Digital Health Ecosystem

Merger And Acquisition Framework Analysis In Digital Health Ecosystem

Published: Aug, 2024
Report ID: GVR-MT-100234
Format: PDF, Horizon Databook

No. of Pages/Datapoints: 50
Report Coverage: 2024 - 2030

Mergers and Acquisitions

Stepwise planning of mergers & acquisitions

Mergers & acquisitions comprise of various steps ranging from planning, research, due diligence, negotiation, closing, and implementation. The key steps involved in mergers and acquisitions are:

Decoding the reason for the merger or acquisition
Quantifying the specific goal or target of the transaction
Panning out the merger and acquisition framework and work through the transaction
Delivering recommendations and strategizing the next plan of action

Mergers And Acquisitions Framework Analysis

Merger and acquisition framework

Detailed Insights: Market Attractiveness

Factors Influencing the Market Attractiveness

Market Size: Estimated and Forecasted

Market Growth Rate: Short Term vs Long Term

Industry Profitability

Average Profit Margins in Market

Porter's 5 Forces & Impact on Market

Various parameters such as market size, market growth rate, industry profit margins, and Porter’s 5 Forces were taken into consideration and these parameters were scored based on their performance and relevance held in the matrix. Amongst the parameters considered the most crucial parameters influencing the matrix score are market growth rates (short term and long term) and industry profitability.

Market Attractiveness of Telehealthcare/ Telemedicine/ Teleconsultation Industry
Parameters	Sub-Parameter	Unit	Data	Benchmark	Score Given	Total Score	Individual Parameter Score (%)
Market Size (2023)		USD Billion	4.11	40	10.275	100	10.3%
Market Forecast (2030)		USD Billion	30.47	40	76.175	100	76.2%
Market Growth Rate	Overall Compound Annual Growth Rate (2024-30)	%	33.40%	50%	66.8	100	66.8%
	Short Term Compound Annual Growth Rate (2024-27)	%	23.60%	50%	16.52	35	47.2%
	Long Term Compound Annual Growth Rate (2027-30)	%	34.10%	50%	44.33	65	68.2%
Average Profit Margins of Telehealthcare/ Telemedicine/ Teleconsultation Industry (EBITDA)		%				100	0.0%
	2023-2026	%	(50.33%)-(15.33%)	12%	-57.4875	45
	2027-2030	%	(10.33%)-5.67%	12%	25.9875	55	47.3%
Porter 5 Forces					83	100	83.0%
	Buyer Power		Moderate		14	20	70.0%
	Supplier Power		Moderate		15	20	75.0%
	New Entrants Threat		Low		18	20	90.0%
	Substitutes Threat		Moderate		16	20	80.0%
	Competitive Rivalry		High		20	20	100.0%
	Total				204.75	500	41.0%

In the above-mentioned table, we have drawn insights from an exhaustive market study on the Telehealthcare/Telemedicine/Teleconsultation industry. The market attractiveness analysis, provides an answer whether the industry the acquisition target plays is attractive or not, also provides insights about the industry profitability, while estimating the total addressable market (TAM). Within this analysis, we have assigned weighted scores as per their relevant impact on shaping the merger & acquisition.

Detailed Insights: Company Attractiveness

Factors Influencing the Company Attractiveness

Company Revenue Performance & Profitability (Net Income, Gross Margin, EBIDTA)

Financial Valuation of Company

Company Profitability

SWOT Analysis of Company

Company Growth Rate (Past 5 Years)

Direct & Indirect Competition (Fragmented/ Consolidated)

Company Differentiation & Competitive Advantages

Within the company attractiveness analysis, the business matrix or competition/product matrix (intangibles) and the financial matrix (tangibles) are analyzed. The financial matrix includes various parameters such as the topline, bottom line, revenue earnings, gross margins, cost of goods sold (COGS), customer acquisition costs (CAC), EBIDTA, net income, historical revenue growth rates, and other unit economies. Similarly, the business or competition matrix analysis is composed of qualitative insights derived from company differentiation, SWOT analysis, competitive advantages, competitive landscape scenario (direct vs indirect)

Category	Parameter	Unit	Company A	Company B	Company C	Company D
Revenue Performance and Company Profitability	Revenue	2019	USD Mn	553.31	xx	xx	xx
		2020	USD Mn	xx	xx	xx	xx
		2021	USD Mn	xx	xx	xx	xx
		2022	USD Mn	xx	xx	xx	xx
		2023	USD Mn	xx	xx	xx	xx
	Revenue Y-o-Y Growth	2020	%	97.7%	xx	xx	xx
		2021	%	xx	xx	xx	xx
		2022	%	xx	xx	xx	xx
		2023	%	xx	xx	xx	xx
	Revenue 5 Year Growth Rate	Compounded Annual Growth Rate (2019-2023)	%	47.3%	xx	xx	xx
	Revenue 5 Year Growth Rate	Average Annual Growth Rate (2019-2023)	%	xx	xx	xx	xx
	Revenue Forecast (2024-2030) USD Million			Revenue	Revenue	Revenue	Revenue
			2024	xx	xx	xx	xx
			2025	xx	xx	xx	xx
			2026	xx	xx	xx	xx
			2027	xx	xx	xx	xx
			2028	xx	xx	xx	xx
			2029	xx	xx	xx	xx
			2030	xx	xx	xx	xx
	Net Loss			Net Loss	Net Loss	Net Loss	Net Loss
		2019	USD Mn	xx	xx	xx	xx
		2020	USD Mn	xx	xx	xx	xx
		2021	USD Mn	xx	xx	xx	xx
		2022	USD Mn	xx	xx	xx	xx
		2023	USD Mn	xx	xx	xx	xx
	EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)	2019	USD Mn	xx	xx		xx
		2020	USD Mn	xx	xx	xx	xx
		2021	USD Mn	xx	xx	xx	xx
		2022	USD Mn	xx	xx	xx	xx
		2023	USD Mn	xx	xx	xx	xx
	EBITDA Y-o-Y Growth	2019	%
		2020	%	xx	xx	xx	xx
		2021	%	xx	xx	467.1%	xx
		2022	%	xx	xx	xx	xx
		2023	%	xx	xx	xx	xx
	EBITDA 5 Year Growth Rate	Compounded Annual Growth Rate (2019-2023)	%	xx	xx	xx	xx
	EBITDA 5 Year Growth Rate	Average Annual Growth Rate (2019-2023)	%	425.7%	xx	xx	-213.0%
	EBIDTA Margin	2019	%		xx		xx
		2020	%	-40%	xx	xx	xx
		2021	%	-3%	xx	xx	xx
		2022	%	0%	xx	xx	xx
		2023	%	3%	xx	xx	xx
	Company Revenue Growth Rate (5 Years)	Compounded Annual Growth Rate (2019-2023)	%	47.3%	xx	xx	xx
	Company Revenue Growth Rate (5 Years)	Average Annual Growth Rate (2019-2023)	%	52.5%	xx	xx	xx
	Operating Costs	2019	USD Mn	xx	xx	xx	xx
		2020	USD Mn	xx	xx	xx	xx
		2021	USD Mn	xx	xx	xx	xx
		2022	USD Mn	xx	xx	xx	xx
		2023	USD Mn	xx	xx	xx	xx

Valuation	Latest Valuation of Company	Revenue Multiplier
		2023	USD Mn	xx	xx	xx	xx
		Acquisition Cost	USD Mn	xx	xx	xx	xx
		User Base Multiplier
		2023	USD Mn	xx	xx	xx	xx
		Acquisition Cost	USD Mn	xx	xx	xx	xx

In the above-mentioned table, we have drawn insights from a comparative analysis amongst selective market players from the industry eligible/willing for merger & acquisition. The market valuation of every company was drawn by analyzing the various financial parameters and competitive landscape parameters. The market valuation analysis was derived using the revenue multipliers as well as user base multipliers, which led to deriving the acquisition cost of each company.

The comparative analysis along with the financial metrics and competitive landscape metrics, enables setting benchmarks for the target company that is eligible for merger and/or acquisition.

Detailed Insights: Synergy Analysis

Types of Synergies
Revenue Synergies	Cost Synergies
Revenue synergies help the company increase revenues.	Cost synergies help the company reduce overall costs.
Examples
Accessing New Distribution Channels		Consolidating Redundant Costs
Accessing New Customer Segments		Procuring Increased Buyer Power
Cross-Selling Products		Procuring Increased Buyer Power
Up-Selling Products
Bundling Products

Within the synergy analysis, the significant synergies involved in the transaction are studied. Several revenue synergies and cost synergies are analyzed, which can be realized from the transaction.

Synergy Analysis

In the above-mentioned table, a comparative analysis is drawn by scoring the companies under the study scope against various parameters under revenue synergies and cost synergies. This analysis allows, matching of the goals & attributes of the target company with the benchmarked companies.

Detailed Insights: Financial Implications and Risk Analysis

Financial Implications	Risk Analysis
Acquisition Price Analysis & Justification	Internal Risk Factors	External Risk Factors
Break Even Analysis	Internal Risk Factors	External Risk Factors
Annual Revenue Growth Rate	Inadequate Due Diligence	Legal And Regulatory Risks
Annual Revenue Growth Rate	Overpayment For Market Volatility	Market Volatility
Expected Cost Savings	Integration Challenges	Geopolitical Risks
Expected Cost Savings	Cultural Misalignment	Economic And Financial Risks
Projected Return on Investment	Technological Disruptions
	Industry Threats
	Market Entry Barriers

The financial implications and risk analysis framework, answers the main question whether the expected financial gains, return on investment, and risks involved justify the acquisition price.

Company Name	Financial Implications
	Annual Revenue Growth Rate (2019-2023) (%)		EBITDA (2023) (USD Million)	Break Even Analysis	Projected Return on Investment	Acqusition Price Analysis	Expected Cost Savings
	AAGR	CAGR	EBITDA (2023) (USD Million)	Break Even Analysis	Projected Return on Investment	Acqusition Price Analysis	Expected Cost Savings
Company A	xx	xx	xx	xx	xx	xx	xx
Company B	xx	xx	xx	xx	xx	xx	xx
Company C	xx	xx	xx	xx	xx	xx	xx
Company D	xx	xx	xx	xx	xx	xx	xx
Total Score				xx	xx	xx	xx
XYZ

In the above-mentioned table, by implementing a comparative analysis, companies have been benchmarked by scoring against several parameters such as average annual growth rate (AAGR), compounded annual growth rate (CAGR), company profitability, breakeven point, projected return on investment, acquisition price, and expected cost savings.

Company Name	Risk Analysis
	Internal Risks				External Risks
	Integration Challenges	Cultural Misalignment	Industry Threats	Market Entry Barriers	Legal & Regulatory	Market Volatility	Geopolitical Risks	Economic & Financial Risks	Technological Disruptions
Company A	4	3	2	3	2	2	3	3	4
Company B	3	3	2	3	2	2	3	2	3
Company C	2	2	1	2	2	1	2	3	3
Company D	2	2	1	2	1	1	1	2	2
Total Sore
XYZ

This parameter is analyzed by using a comparative scorecard analysis basis of various factors impacting the risk involved.

Case Study Analysis: Doximity Acquires Amion

Case Study Title: DOximity’s strategic acquisition of Amion, to enhance the physician cloud platform

Objective: To explore the rationale, impact, and future implications of the acquisition on Doximity;s growth and market position.

Company Introductions

Doximity

Amion

Doximity, Inc., is a digital platform specifically designed for medical professionals. It provides a suite of tools and services to help them connect, communicate, and collaborate more efficiently. The platform combines elements of social networking with professional resources to forge a unique space where healthcare professionals can stay informed, share insights, and maintain their professional relationships.

Doximity was formerly known as 3MD Communications, Inc. and was founded in 2010.

Headquarters: U.S.

Employee Count (2024): 827

AMiON, a company specializing in scheduling solutions for medical staff and doctors on call, is known for its comprehensive software that streamlines the process of creating and managing complex medical schedules. Their platform serves a critical role in healthcare settings, ensuring that staffing matches the fluctuating demands of patient care effectively and efficiently. Amion's software provides: A user-friendly interface. Allowing easy access and adjustments to schedules by both administrators and staff members. Thus fostering a more organized and collaborative environment. This functionality is particularly important in the fast-paced medical field, where the accurate scheduling of doctors on call can significantly impact both patient care and staff well-being.

Acquisition rationale and financial impact of the acquisition

Implications of acquisition

Trend and future outlook of the acquisition

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