Consolidation in the UK healthcare recruitment sector is set to continue, according to Tim Evans, managing director at deals specialist Boxington Corporate Finance.

Evans’ comments follow FT reports over the weekend that US private equity firm Blackstone had acquired healthcare recruiter Pulse.

A spokesperson for Pulse told Recruiter that the firm is not currently commenting on the reports.

Evans told Recruiter: “I think it is a good strategic move for them. Pulse is one of the sufficiently large targets for Blackstone to be interested in. Strategically, it is high value. There are not many alternatives for Blackstone to buy.

“I don’t think it is the end of the consolidation [in the sector] because there are a number of small to medium-sized interim players which will also be attractive.

“There is a sense within healthcare that smaller players will get squeezed and the larger players such as Pulse and [Blackstone company] ICS or whatever will they be called, now they are merged, will be in a stronger position. Larger businesses will be more resilient against gross margins and budgetary pressures towards cost savings.”

Kevin Barrow, partner, Osborne Clarke, told Recruiter that he could not comment on this particular deal but adds: “Without specifically commenting on this deal, the private equity industry sees certain sub-sectors of recruitment a good bet for a consolidation play. It is all about process rather than quality because there aren’t that many quality differentiators in the perception of clients.

“It is an obvious consolidation play – it is cash generative. Private equity firms like things that generate cash weekly or monthly. They like businesses that are scalable, where you can sell or brand rather than through the connections of specific individuals. That is increasingly important in healthcare because you sell on the basis of preferred supplier lists rather than on individual connections of recruitment consultants.”