Centene completes sale of AI business Apixio

UPDATED June 15 at 10:45 a.m.

Centene has closed its divestiture of artificial intelligence platform Apixio, the insurer said this week.

The company announced in early May that it had found a buyer for the AI business in venture capital firm New Mountain Capital. Financial terms of the deal were not disclosed, though Centene said it expects the deal to be earnings neutral for 2023.

Centene scooped up Apixio in 2020. The insurer has been conducting a review of its portfolio as part of its broader value creation plan.

"We are confident this transaction will best position Apixio to expand its impact as a leading artificial intelligence platform that enables value-based care programs across the country," said Centene CEO Sarah London in the announcement. "The close of this transaction and our ongoing partnership with Apixio are a reflection of our continued execution against our long-term strategy and value creation efforts."

Centene has found a buyer for Apixio, which provides artificial intelligence services to enable value-based care.

The government insurance giant has entered into a definitive agreement to sell off Apixio to New Mountain Capital, a venture capital firm with a $37 billion war chest in assets and an organization focused on growth, according to an announcement issued Wednesday.

Apixio's technology improves administrative, clinical and financial programs for health plans across the country, Centene said, and is backed by a proprietary clinical data and artificial intelligence platform. CEO Sarah London said it was important to find a buyer that would allow Apixio to continue to "grow, innovate and thrive."

Centene acquired Apixio in 2020. As part of its value creation plan, Centene has been conducting a complete review of its portfolio and has made several strategic divestitures over the last several months to generate greater value for its enterprise.

"Apixio has been a trusted business partner since our relationship began in 2015," London said. "We are confident that New Mountain Capital is well positioned to ensure that Apixio continues to support the success of its clients given their sector expertise and long-term focus."

The sale is subject to regulatory approval and other closing conditions, and Centene said it expects it to be earnings neutral in 2023.

"We admire Apixio as a leading healthcare technology company that offers a differentiated value proposition using machine learning and analytics," said Matt Holt, managing director and president of private equity at New Mountain Capital, in the release. "Through continued investment in products, services and technology, we are excited to build Apixio into a 'connected care' platform that brings together critical infrastructure to enable the shift to outcomes-based reimbursement models."