M&A Transactions

Teladoc bulks up its services for the critically ill and acquires Best Doctors based in Quincy, MA for $375 million in cash and $65 million in stock.

For a company that will have $100 million in revenue in 2017, this is clearly a steep price to pay. Then again, Teladoc so far has focused on routine eVisits. Best Doctors has 50,000 of the top doctors in the world that cover 450 complex specialties. Jeffries provided the financing for Teladoc which minimizes the dilution.

We have been huge fans of Teladoc from day one and applaud Jason Corevic for his tenacity to push the limits of eVisit from covering just simple health conditions to now the most complex diseases.

Cognizant snaps up HSCS’s unit, TMG Health

TMG Health is a national provider of software solutions for Medicare Advantage, Medicare Part D and Managed Medicaid plans. This is a perfect build on top of Cognizant’s acquisition of TriZetto in 2014. TMG supports 32 plans with 4.3 million members. The fit is also a good one for Cognizant’s business process as service (BPaaS) strategy.

Austin-based Kinnser Software is picked up by TPG-backed Mediware

Kinnser offers comprehensive software solutions to the post-acute sector including home health and hospice providers. Insight Ventures first invested in the company back in 2012. TPG wasted no time to bulk up the revenues of Mediware which it bought from Thoma Bravo in February of this year. Mediware, founded in 1980 providers a variety of software services to state and federal agencies, blood banks, human and social services, etc.

GreatCall based in San Diego, CA is picked up by GTCR

The PERS market (personal emergency response services) is ripe for technology innovations. The elderly and disabled have used PERS services for decades which connects them to trained agents in the case of emergency and dispatches personnel to the site. That type of installed base is perfect ground for products such as urgent virtual care, care coordination with family and friends, and medication adherence; just to name a few. GTCR is one of the most highly regarded firms in the PE community.

Great Hill Partners recapitalizes Columbus-based Quantum Health

Quantum is a respected name in the corporate wellness market. Admittedly the sector has experienced some growing pains but Quantum has done a superb job in profiling high risk employees who have shown over 70% engagement rate. And that drops right to the bottom line.

athenahealth buys Palo Alto, CA-based Praxify for $63 million

athena is not a very acquisitive company. With the exception of Epocrates which was a $300 million acquisition (with disappointing results), the company has done smaller fringe deals. We think Praxify is a different story. Although small with only 80 employees, Praxify is an EMR optimization company with deep research underpinning. The company gathered 125 physicians from around the world to conduct a comprehensive study which identified exactly where decision support systems were falling short. And that is how the software was created. The system has machine learning, natural language processing capabilities and a rich mobility platform which athena is keen to bring to their existing clients.

Afsaneh Naimollah

Xen Partners

242 Forest Avenue
Palo Alto, CA 94301
mobile: + 1 (917) 887-4278

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