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Non-public fairness agency Bain Capital has struck a deal to purchase US healthcare software program firm HealthEdge, in a transaction that values the enterprise at about $2.6bn together with debt.
The deal is the newest in a string of profitable gross sales of personal equity-backed software program firms introduced in latest weeks. Bain introduced the deal late on Tuesday, confirming an earlier report within the Monetary Instances.
As a part of the deal, Blackstone will exit its controlling stake in HealthEdge, which it has owned since 2020. Small minority shareholders, corresponding to Philippe Laffont’s Coatue Administration can even offload their stakes, the folks with data of the scenario stated.
The software program sector, which is extra insulated from the affect of President Donald Trump’s aggressive tariffs coverage than another industries, has confirmed to be a relative vivid spot for dealmaking as wider mergers and acquisitions exercise has slowed.
Bain didn’t disclose the valuation of the deal in its assertion however folks briefed on the takeover stated the non-public fairness group paid $2.6bn together with debt. Blackstone declined to remark. HealthEdge and Coatue didn’t instantly reply to requests for remark.
HealthEdge sells novel software program for well being insurers to modernise their methods in ways in which ease designing healthcare plans and deciding about claims. It serves 115 well being plans within the US, representing greater than 110mn coated lives.
Devin O’Reilly and Paul Moskowitz, the Bain companions behind the deal, stated HealthEdge stood to be a “driving pressure” of the deployment of generative synthetic intelligence in well being plans.
The corporate generated $86mn in earnings earlier than curiosity, tax, depreciation and amortisation final yr, in addition to $400mn in revenues, in line with one individual briefed on the deliberate transaction.
Bain Capital oversees $185bn of property underneath administration, with investments throughout enterprise providers, healthcare, know-how and industrials. It owns healthcare payer behemoth Zelis and this yr made a take-private bid for healthcare group Surgical procedure Companions.
Blackstone first put HealthEdge up on the market in 2022. Nonetheless, the non-public fairness group struggled to discover a purchaser keen to pay sufficient to safe it a return on the $700mn it had paid in 2020 when traders had been piling cash into healthcare firms firstly of the Covid-19 pandemic.
Blackstone bankrolled bolt-on acquisitions at HealthEdge together with the takeovers of Wellframe and Altruista Well being. It should roughly double its cash on the sale, an individual briefed on the matter stated.
M&A exercise has dried up in latest weeks as monetary market turbulence, considerations that rates of interest could fall at a slower-than-expected tempo because of Trump’s commerce coverage, and the specter of tariffs to firms’ enterprise fashions has put most deal talks on pause.
But a number of massive software program transactions have gotten over the road: Clearlake Capital purchased a majority stake in digital well being information firm Modernizing Drugs, valuing the enterprise at $5.3bn, and Siemens AG purchased the life-sciences software program firm Dotmatics for $5.1bn.