Dive Brief:
- Saint Peter’s Healthcare System and Atlantic Health abandoned plans to merge on Monday, citing impacts of the “rapidly evolving healthcare landscape nationally.”
- The New Jersey-based health systems first announced plans to combine in January last year and signed a definitive agreement to merge in June 2024.
- The systems shared scant details about why the deal fell apart. However, in a joint statement issued Monday both Atlantic President and CEO Saad Ehtisham and Saint Peter’s President and CEO Leslie Hirsch called the deal’s end disappointing.
Dive Insight:
The proposed deal would have joined Atlantic’s more than 550 sites of care, including eight hospitals, with Saint Peter’s single, 478-bed hospital and other outpatient facilities.
The scuttled deal marks the second failed merger for Saint Peter’s in recent years. The New Brunswick health care system and RWJBarnabas Health sought to merge in 2020. However, the health systems called off the merger in 2022 after the Federal Trade Commission sued to block the deal, alleging it would reduce competition.
Healthcare mergers and acquisitions have been depressed this year relative to 2024. During the second quarter, just eight transactions were announced — the lowest quarter since at least 2017, according to data from Kaufman Hall.
The consultancy attributed some of the dip in activity to business challenges, as well as uncertainty about federal and state policies. While the consultancy hoped to see a rebound in M&A during the back half of 2025, it made that prediction contingent upon providers’ sense of stability.
Instead, the industry has been hit by continued policy pressures since July, including looming Medicaid cuts, tariffs on pharmaceuticals, hikes to fees for H-1B visa applications and a government shutdown as lawmakers face the expiration of Affordable Care Act subsidies.
