AthenaHealth sold for $5.7 billion to Veritas Capital and Evergreen Coast Capital. Read below for the full article from Healthcare IT News.

Athenahealth is set to be acquired by Veritas Capital and Evergreen Coast Capital for $5.7 billion.

Together, Veritas and Evergreen, the private equity subsidiary of Elliott Management, the hedge fund that has actively urged athenahealth to sell for more than a year, will pay $135 per share for the cloud IT company – about 12 percent more than its valuation at the close of trading this past Friday.

The deal brings to a resolution a matter that has been much discussed over the past two years. Elliott, which had a 9 percent ownership position in the firm, had pressured the Watertown, Massachusetts-based company to sell since 2017, claiming it could to better with operational efficiencies that would maximize shareholder value.

Upon completion of the acquisition, which has been unanimously approved by the athenahealth board and is expected to close in the first quarter of 2019, Veritas and Evergreen plan to combine athenahealth with Virence Health, the former value-based care group of GE Healthcare that was bought by Veritas this years.

Together the companies, operating under the athenahealth brand, will continue developing technologies to help provider customers succeed in the era of accountable care, officials said.

The company will be led by Virence Chairman and CEO Bob Segert, as well as executives from both firms. (Upon the deal’s completion, Virence’s Workforce Management business will become a separate Veritas portfolio company under the API Healthcare brand.)

Since 2017, athenahealth has undergone a major restructuring, hired ex-GE chief exec Jeff Immelt as chairman, saw its founding CEO step down amid allegations of past abuse, layoff hundreds of workers and sold its corporate jet.

Veritas has been in buying mode for health IT companies recently, including its Verscend Technologies subsidiary’s aquisition of Cotiviti this summer.

Jeff Immelt, executive chairman of athenahealth, said the deal “maximizes value for our shareholders and accelerates our goal to transform healthcare.” By joining with Virence, athenahealth “will create new opportunities for collaboration and growth,” he added. “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.”

“We are excited by the opportunity to partner with athenahealth, one of the largest and most connected provider networks in the nation, to drive outcomes that matter the most to our customers,” added Virence CEO Bob Segert. “athenahealth and Virence have complementary portfolios and highly-talented people, and this combination expands our depth and reach across the continuum of care. I’m looking forward to combining our mission-driven cultures to create an even stronger healthcare IT company.”

Twitter: @MikeMiliardHITN
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