Allscripts is selling its care coordination business to WellSky for $1.3 billion, the health IT company announced Tuesday.
Boston-based CarePort Health, which Allscripts acquired in 2016, develops software that connects acute and post-acute providers and payers.
Health technology company WellSky said the acquisition of CarePort will enable the company to facilitate effective patient care transitions across the continuum—driving better outcomes for patients, providers and payers, according to a press release.
With the addition of CarePort, WellSky is uniquely positioned to manage the acute care discharge process, track patients across post-acute care settings, apply patient and population level analytics, and support electronic medical record-based care protocols, the company said.
Overland Park, Kansas-based WellSky is jointly owned by two of the world’s largest private equity firms, TPG Capital and Leonard Green & Partners.
CarePort’s electronic health record-agnostic suite of solutions connects the discharge process with post-discharge care coordination—allowing providers and payers to track and manage patients throughout their care journey. CarePort solutions help hundreds of hospitals and thousands of post-acute care providers efficiently coordinate and transition patients through different settings of care, according to WellSky.
“Together with CarePort, WellSky will establish new, meaningful connections between historically disparate settings of care. We have the exciting opportunity to bring care coordination to more providers in service of delivering more informed, personalized care,” said Bill Miller, CEO of WellSky, in a statement.
“Through this agreement, we’re ensuring our clients have the intelligent technology they need to do right by their patients, collaborate with payers, and succeed in value-based care models," he said.
With WellSky’s experience in post-acute care and CarePort’s suite of care coordination solutions, the acquisition is a "natural fit," company officials said. CarePort clients will gain access to a broader network of post-acute providers and can leverage WellSky’s predictive analytics suite and value-based care technologies.
"This agreement is another all-around win for Allscripts as it unlocks significant value for our shareholders, enables us to increase our focus on our core business and brings our CarePort customers the benefit of continued investment under new and very strong ownership," said Rick Poulton, Allscripts president and chief financial officer, in a statement.
Allscripts said in a press release the agreed sale price of $1.35 billion represents a multiple of greater than 13 times CarePort’s revenue over the trailing 12 months.
Shares of Allscripts surged 55% in the extended trading session Tuesday after the company announced the deal, according to Nasdaq.com.
CarePort is included in Allscripts' data, analytics and care coordination reporting segment and represents approximately 6% of Allscripts consolidated revenues.
Allscripts said it expects the net after-tax proceeds from the sale to be used to invest in its solutions, further deleverage the company’s balance sheet and support significant share repurchases.
It marks the second sell-off for Allscripts in the second half of 2020. The company sold its EPSi business to Strata Decision Technology for $365 million, it announced during its second-quarter earnings call July 31.
EPSi is a provider of financial decision support and planning tools for hospitals and health systems. That transaction is expected to close later in the third quarter.
The CarePort Health sale is expected to close before the end of the year, subject to receipt of regulatory clearances.
William Blair and J.P. Morgan Securities, LLC acted as financial advisers to Allscripts in connection with the sale of CarePort.