UnitedHealth Group’s Optum subsidiary introduced on Wednesday it’s going to purchase Change Healthcare in a deal that values the Nashville-based well being tech firm at roughly $eight billion.
Optum pays $25.75 per share in money, up 41% over Change Healthcare’s closing closing value on Tuesday of $18.74. A Change Healthcare spokesperson mentioned the deal contains $5 billion in debt owed by the corporate, bringing its complete worth to $13 billion.
Change Healthcare will be a part of OptumInsight to supply information analytics, income cycle administration and fee processing capabilities.
Optum goals to combine its billions of claims information and automatic fee processing device with Change Healthcare’s clever healthcare community to extra rapidly course of funds for suppliers and extra transparently invoice payers and sufferers. The corporate additionally plans to combine Change Healthcare’s affected person engagement device—which reaches greater than 200 million people per yr—with people’ well being advantages, to make it simpler for shoppers to benefit from incentive packages that reward wholesome behaviors.
Optum CEO Andrew Witty, who additionally serves as president of UnitedHealth Group, added that Change Healthcare will even provide clinicians rapid, analytical perception on how greatest to take care of particular person sufferers.
“Collectively we’ll assist streamline and inform the very important scientific, administrative and fee processes on which healthcare suppliers and payers rely to serve sufferers,” Witty mentioned in an announcement.
On the finish of its most up-to-date third quarter ended Sept. 30, OptumInsight accounted for $2.76 billion in income, up from $2.61 billion throughout the identical interval in 2019. It accounted for about four% of the corporate’s complete general earnings. That features income from exterior purchasers in addition to “affiliated clients” inside UnitedHealth Group. OptumInsight generated the smallest quantity of income for Optum throughout that interval.
UnitedHealth Group expects Change Healthcare to extend its earnings per share by as much as $zero.50 by 2022.
Neil de Crescenzo, president and CEO of Change Healthcare, will lead OptumInsight as soon as the acquisition closes. The settlement is anticipated to shut within the second half of 2021 and is topic to Change Healthcare shareholders’ and federal regulators’ approval.
Non-public fairness funds affiliated with The Blackstone Group, which owns 20% of Change Healthcare, have agreed to the acquisition.
“This chance is about advancing connectivity and accelerating improvements and efficiencies important to a less complicated, extra clever and adaptive well being system,” de Crescenzo mentioned in an announcement.