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Jeff Immelt, the former CEO of General Electric, was named executive chairman of Athenahealth in June.
Photo:
Pat Sullivan/Associated Press
Health-care software firm
Athenahealth
Inc.
is selling itself to two private-equity firms for $5.47 billion in cash months after an activist investor offered to take the business private.
The two private-equity firms—Veritas Capital and Elliot Management Corp.’s Evergreen Coast Capital—are going to combine the company with Virence Health Technologies. Veritas bought the assets that make up Virence Health from GE Healthcare earlier this year.
According to the announcement Monday, the private-equity deal breaks out to $135 per share for Athenahealth shareholders. As of Sept. 30, Athenahealth had $232.3 million in long-term debt.
Shares of Athenahealth, which closed Friday at $120.35, were up 9.5% Monday.
Elliott Management, which acquired a nearly 9% stake in Athenahealth in 2017, offered to buy the rest of the company and take it private in May. The firm’s offer was to buy the rest of the company for $160 a share, which valued the company at $6.5 billion.
The company had announced in June that its board was going to start looking at strategic alternatives for the firm. At that time, co-founder Jonathan Bush stepped down as president and chief executive amid takeover pressure from Elliott. Jeff Immelt, the former CEO of General Electric Co., was also named executive chairman of Athenahealth.
When combined with Virence Health, the company will operate under the Athenahealth brand and also keep its headquarters in Watertown, Mass., the announcement said. Virence Health Chief Executive Bob Segert will run the company.
When the deal is finished, Virence’s workforce management business will go under the API Healthcare brand and be a separate Veritas company, according to the announcement.
Write to Allison Prang at [email protected]
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