EHR provider athenahealth reviewing $6.9bn acquisition offer

By Melissa Fassbender contact

- Last updated on GMT

(Image: cyano66)
(Image: cyano66)
The company, which has partnerships to support clinical trials recruitment, has received an unsolicited acquisition offer from Elliott Management – skyrocketing the EHR provider’s stock.

“Consistent with its fiduciary duties and following consultation with its independent financial and legal advisors, the athenahealth Board of Directors will carefully review the proposal to determine the course of action that it believes is in the best interest of the Company and athenahealth shareholders,”​ athenahealth said in a statement.

The company provides medical record, revenue cycle, patient engagement, care coordination, and population health services. Its network spans 114,000 providers and 110m patients.

The company has partnered with companies such as ePatientFinder​ to drive clinical trials recruitment. Austin, TX-based ePatientFinder provides physicians and clinical trial sites with a secure technology platform to leverage EHR data for the recruitment purposes.

Athenahealth has also inked marketing agreements​ with the open source clinical trial software company OpenClinica.

The Strategy

Ross Muken, an analyst with Evercore ISI, said the development is not surprising, though the timing is interesting, as Athena has recently posted disappointing bookings. As per strategy, Muken said that “there looks to be a number of directions this may go.”

“All-in this is an intriguing development,”​ he added.

Elliott Management currently owns 8.9% of athenahealth.

The proposal

In a letter to the board of directors at ​athenahealth, Jesse Cohn, partner and senior portfolio manager at Elliott Management, noted that the fund manager initially approached athenahealth last year, at which time "there existed considerable opportunities for business improvement,"​ he explained.

However, Cohn said the company has since "not made the changes necessary to enable it to grow as it should and to create the kind of value its shareholders deserve."

"In short, athenahealth is facing one of the most difficult transitions a technology company can make at a time when persistent missteps and controversy have likely permanently impaired​ its public-market valuation,"​ he added.

"At a juncture like the one ​athenahealth presently faces, the case for going private is compelling and cannot be ignored."

Related topics: Clinical Development

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