Less than three years after it was bought out by private equity investors, athenahealth will soon change hands again. Its current owners, Veritas Capital and Evergreen Coast Capital, struck an agreement to sell it for $17 billion to Bain Capital and Hellman & Friedman. The deal will be financed through a mixture of equity and debt.
In September, Bloomberg reported that Veritas and Evergreen had begun exploring options, hoping to fetch a $20 billion valuation for the company. Both firms will keep a minority stake after the deal closes.
Watertown, Mass.-based athenahealth largely caters to ambulatory care providers with its cloud-based EHR system. It claims to have more than 140,000 providers as customers.
At $17 billion, athenahealth is selling at a premium from when Veritas and Elliott Management-affiliate Evergreen first bought it for $5.7 billion in 2019. Activist investor Elliott had been aggressively pushing the company to sell for a year, looking to take it private and change its operations. While the company faced a takeover bid, then-CEO and founder Jonathan Bush stepped down as sexual harassment allegations came to light.
After the deal finally closed, athenahealth has remained private, merging with health IT company Virence Health, which was spun out of GE Healthcare.
“Over the course of our successful partnership with Bob and the management team, athenahealth has driven tremendous growth and transformation, reinforcing its position as the premier healthcare IT company supporting the largest nationwide network of healthcare providers,” Veritas Capital CEO and Managing Partner Ramzi Musallam said in a news release. “Following our take-private and combination with Virence in 2019, athenahealth delivered unrivaled value to its customers by significantly increasing R&D investment resulting in higher quality care, lower costs across the healthcare ecosystem, and overall improved patient outcomes.”
Athenahealth’s current leadership, including CEO Bob Segert, will continue to helm the company after the merger. The deal is expected to close in the first quarter of next year.
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