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Hedge fund Elliott Management and private equity group Veritas Capital would buy Athenahealth Inc. (ATHN) for $ 5.5 billion in cash, Reuters said, citing unnamed sources.
The two companies plan to buy the Massachusetts-based healthcare software company for $ 135 per share, according to Reuters. That's well above Friday's close of $ 120.35, but less than the $ 160 per share offered by Elliott to the company in May. Shares climbed to $ 124 after regular business hours.
Reuters announced that the companies would announce the transaction Monday morning, but declined to comment before that date. Elliott already holds about 9% of the company's capital and would have pushed for a sale. Athenahealth has cut jobs and appointed Jeffrey Immelt, former CEO of General Electric (GE), chairman earlier this year as part of a restructuring.
ATHN was seen as a take-away candidate since CEO Jonathan Bush, who founded the company 21 years ago, stepped down earlier this year. Bush, a nephew of former President George H. W. Bush resigned after the media claimed he had abused his former wife 14 years ago.
Athenahealth had just announced its third quarter results on Friday and was holding a teleconference Monday afternoon to discuss the company's results and outlook. The delay in the call for results would have raised rumors that an acquisition could be imminent.
(This story has been updated.)
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