athenahealth is going to be acquired by Veritas Capital and Evergreen Coast Capital for $135 per share in a deal valued at approximately $5.7 billion in cash. The price per share represents a 12% premium of the company’s closing stock price on November 9th — which is the last trading day prior to the announcement. athenahealth is a leading provider of network-enabled services for hospitals and ambulatory customers.
Once the deal is closed, Veritas and Evergreen are expecting to combine athenahealth with Virence Health, which is the GE Healthcare Value-based assets that Veritas bought earlier this year. The combined company is expected to become a leading privately held healthcare information technology company with an extensive national provider network of customers and solutions to help them thrive in a complex environment.
After the closing of the transaction, the combined company will operate under the athenahealth brand with headquarters in Watertown, Massachusetts. The combined company will be led by Virence Chairman and CEO Bob Segert. And the executive team will comprise of executives from both companies. And Virence’s Workforce Management business will become a separate Veritas portfolio company under the API Healthcare brand.
“After a thorough strategic review process, we have decided to enter this agreement with Veritas, which we believe maximizes value for our shareholders and accelerates our goal to transform healthcare,” said athenahealth Executive Chairman Jeff Immelt in a statement. “Combining with Virence will create new opportunities for collaboration and growth. Operating as a private company with Veritas’s ownership and support will provide athenahealth with increased flexibility to achieve our purpose of unleashing our collective potential to transform healthcare.”
Veritas is known for its high profile investments and acquisitions within the healthcare technology space. This is proven by the acquisitions of Verscend Technologies and it’s investment in Truven Health Analytics.
“athenahealth is a market leader and a natural and strategic fit with Virence,” added Veritas Capital CEO and managing partner Ramzi Musallam. “Virence and athenahealth have differentiated and complementary solutions, deep relationships with their respective customer bases and a shared culture of commitment to innovation. We look forward to leveraging our expertise in the sector, as well as the capabilities and solutions across both companies to provide superior value to customers, and create exciting growth opportunities for both sets of employees as Bob and the team build the future of healthcare IT.”
This transaction is expected to close in the first quarter of 2019. And the deal is subject to the approval of the holders of a majority of athenahealth’s outstanding shares and is satisfaction of customary closing conditions.