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To show the strength of health tech, private equity companies have acquired Athena health for $ 17 billion

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Bob Segert, CEO of Athenahealths, said the acquisition was an important milestone for the company.

We are pleased to work with Hellman & Friedman and Bain Capital to advance the next phase of our growth journey. The company added that it aims to build a thriving ecosystem that provides universally accessible, high quality and sustainable healthcare.

Segart and his current management are expected to continue their role, officials said.

Athenahealth was founded in 1997 by Jonathan Bush, nephew of former President George HW Bush, and Todd Park, who later became Chief Technology Officer of the United States. The company initially focused on making it easier for doctors to schedule and bill services. Since then, it has expanded to provide telemedicine and other online services, including a drug information phone app called Epocrates. In the process, Athenahealth raised $ 113 million in its initial public offering in 2007.

In 2017, activist investor Elliott Management Corp. purchased a 9.2% stake in the company. Shortly thereafter, Bush bid $ 6.4 billion to buy the company he resisted. In 2019, Veritas Capital and Evergreen Coast Capital made Elliott’s Private Equity Division private for $ 5.7 billion. The sale followed a bitter campaign focused on Bush, who resigned from his role as CEO in 2018 following exposure from divorce proceedings that Bush assaulted his wife. Bush publicly apologized in 2018.

Veritas and Evergreen merged Athenahealth with Virence Health, a medical IT business that was formerly part of GE Healthcare, in 2019. As part of the deal, Virence’s CEO, Segert, has been appointed CEO of Athena health. Today, the company is expanding its healthcare platform to serve more than 140,000 outpatient care providers across all 50 states and more than 120 specialists, according to company officials. According to PitchBook data, the company has about 6,000 employees.

Michael Greeley, co-founder and general partner of investment firm Flare Capital Partners, said the pandemic played a decisive role in Athena health with three times the sales two years ago.

The healthcare system had to run on a virtual on-demand basis. [and] Intelligent in 2 years. He said the only way you can do that is really through state-of-the-art technology. Athenahealth is in the middle of the entire infrastructure that makes it possible. (Greeley is not involved in the company.)

He added that the acquisition is likely to set Athenahealth for relisting in the future, which could lead to a surge in valuations. They are investing and think they are going to make two to three times their money, he said about Bain Capital and Hermann & Friedman. I’m sure there’s a $ 50 billion company here.

As part of the New Deal, officials said the current owner will hold a minority stake in the company. New investors such as GIC, Singapore’s Sovereign Wealth Fund and a subsidiary of the Abu Dhabi Investment Authority will also participate. Evercore and Goldman Sachs are key financial advisors to the acquisition.

Allen Thorpe, a partner at Hellman & Friedman, said his company’s expertise in software and healthcare will enable Athena health to grow. We are excited to innovate and grow with the most disruptive and innovative outpatient healthcare clients to lay the foundation for a multi-faceted digital care network between patients, payers and providers.

Ramzi Musallam, CEO and Managing Partner of Veritas Capital, added that the sale reflects the company’s growth over the last two years, driven by investment in R & D. Athenahealth has driven tremendous growth and transformation, strengthening its position as the premier healthcare IT company supporting the nation’s largest network of healthcare providers.

The acquisition demonstrates Greater Boston’s strengths in the health tech sector and could have a spillover effect on the region over the next few years, Greeley said.

It only solidifies Boston as a truly important market for healthcare technology, he said. When this company is sold or released … executives become angel investors and mid-sized executives become entrepreneurs. Therefore, these kinds of success stories have a really great replay effect.

You can access Pranshu Verma at [email protected] Follow him on Twitter @ pranshuverma_.

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2/ https://www.bostonglobe.com/2021/11/22/business/private-equity-firms-acquire-athenahealth-17-billion/

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