Athenahealth adds new financial adviser as it considers Elliott Management’s offer

Athenahealth building
Athenahealth's board of directors is considering Elliott Management's offer, according to a letter from the firm. (Athenahealth)

Athenahealth has retained a new financial adviser to help analyze Elliott Management’s offer to buy the company, even as it pushed back on claims that most shareholders are gunning for a sale.

In a statement on Thursday, the EHR vendor said it has retained the high-powered investment firm Centerview Partners to assist the board of directors, in addition to Lazard.

The addition of Centerview Capital—which had not been previously disclosed—adds an experienced merger and acquisitions firm to the mix, a sign the board is seriously considering one or more proposals, one person familiar with the situation told FierceHealthcare.

Athenahealth’s statement came in response to a third letter (PDF) from Elliott Management to the board of directors on Thursday in which the firm said a “significant portion” of Athenahealth’s shareholder base is supportive of the exploring a sale, including Elliott Management’s offer.

The letter also noted that the firm is “aware that other parties have expressed interest in participating a sale process.” Meanwhile, analysts have speculated that larger companies, including Cerner, Apple or Amazon, could be interested in acquiring the company.

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“Athenahealth’s shareholders have spoken, and it is clear from their words and actions that rejecting the idea of evaluating a sale and instead offering assurances that the Company has a standalone plan for getting back on track will not be accepted,” Jesse Cohn, a partner and senior portfolio manager with Elliott Management wrote in the letter. “The feedback we’ve received suggests that athenahealth would find shareholder patience for such promises exceedingly low.”

That sparked a response from Athenahealth, which said it was conducting a “deliberate analysis of Elliott Management’s proposal” despite the firm's attempts to “publicly pressure the Board and management team.”

“Although the Company does not comment on the specifics of any conversation with its shareholders, this ongoing engagement has been constructive and has provided an opportunity for shareholders to share their perspectives with management and the Board,” the company said. “Based on our discussions with shareholders, we do not believe the positions set forth in Elliott Management's letter are representative of the positions of all of our shareholders.”

RELATED: Elliott Management proposes Athenahealth takeover worth almost $7B

The EHR vendor has remained relatively quiet following Elliott Management’s highly publicized offering to buy the company for $160 per share earlier this month. The back-and-forth comes less than a week after Athenahealthcare’s top investor, Janus Henderson Group, urged the company to consider a sale in an SEC filing. Analysts told FierceHealthcare that would likely force shareholders to choose sides.  

Elliott Management’s public pressure on the company has also created a distinct power struggle between the activist investor and the company, setting up what could be a contentious battle for the company.

“Elliott had control of the narrative and now Athenahealth is pushing back,” said Andrew Freedman, a healthcare analyst with Hedgeye Risk Management.