Computer Programs and Systems (NASDAQ:CPSI), a leading provider of healthcare information solutions to rural and community hospitals, agreed to acquire Healthland Holding and its subsidiaries American HealthTech and Rycan Technologies. The acquisition price is $250 million, payable 65% in cash and 35% in CPSI stock.
“We are excited to welcome Healthland into CPSI’s family of healthcare IT companies,” said Boyd Douglas, president and CEO of CPSI. “Healthland’s history tracks a very similar course to that of CPSI, as we both have over 30 years of experience in the healthcare IT space, and we share a strong commitment to the improvement of community healthcare. The combination of these two long-standing companies creates in CPSI a broad product portfolio across the continuum of care. Together, we will service a client base of approximately 1,200 acute care facilities and more than 3,300 post-acute care facilities, including Healthland’s American HealthTech subsidiary.”
“As the healthcare industry transitions to value-based reimbursement, our combined solutions will connect communities, patients and providers to facilitate more effective population health management, better patient engagement, and the advancement of quality and care coordination. In addition to an expanded client and solution base, the acquisition will also create synergies in our healthcare services offerings to address the acute and post-acute care markets’ demand for improved financial and operational performance,” added douglas.
“With the ongoing transformation in community healthcare, this combination will enable us to deliver solutions faster for our clients and better scale our development investment and customer support across the many communities we serve,” said Chris Bauleke, CEO of Healthland. “Delivering meaningful solutions for our customers as they prepare for the transition into value-based payment models will continue to be a priority.”
The transaction is expected to close in 2015, subject to customary closing conditions. CPSI also announced the expansion of its senior management team to lead the company going forward. To finance the cash portion of the transaction, CPSI will use cash available on its balance sheet, and $150 million of debt to be funded by Regions.
CPSI’s financial advisor in this transaction was Allen & Company and Maynard, Cooper & Gale, and Paul, Weiss, Rifkind, Wharton & Garrison served as legal counsel to CPSI. Shearman & Sterling served as legal counsel to Healthland.
Healthland is a leading provider of integrated technology solutions to rural community and critical access hospitals. Software and services from Healthland, including electronic health records (EHRs), help customers share patient information across care settings to coordinate treatment, improve patient outcomes, and drive patient satisfaction. In 2013, Healthland acquired Mississippi-based American HealthTech, one of the nation’s largest providers of financial and clinical technology solutions in post-acute care, serving over 3,300 skilled nursing facilities. Rycan Technologies, acquired by Healthland in April 2015, offers SaaS-based revenue cycle management workflow and automation software to over 290 hospital customers. Healthland is headquartered in Minneapolis, Minn., with offices in its founding rural community of Glenwood, Minn.
CPSI is a leading provider of healthcare solutions for community hospitals. CPSI is the parent of two companies – Evident and TruBridge. Evident provides comprehensive EHR solutions for community hospitals. TruBridge focuses exclusively on providing business, consulting, and managed IT services to community healthcare organizations, regardless of their IT vendor. The company was founded in 1979 and is headquartered in Mobile, Alabama.