Athenahealth files its acquisition with SEC: 6 deal details

Athenahealth filed a notice with the Securities and Exchange Commission detailing its shareholder vote on its proposed acquisition, according to HIStalk.

In November, private equity firm Veritas Capital and Evergreen Coast Capital, an affiliate of hedge fund Elliott Management, agreed to buy athenahealth for an estimated $5.7 billion in cash.

The terms of the agreement give athenahealth shareholders $135 in cash per share, a premium of roughly 12 percent over the company's closing stock price on Nov. 9 —  the last trading day before the companies' acquisition announcement Nov. 12.

Here are six things to know about the deal, as laid out by HIStalk:

1. The acquirers will take on several billion dollars of debt to finance the acquisition, including $4.475 billion of debt financing.

2. In total, 65 companies expressed interest in acquiring athenahealth, 32 of which were financial sponsors. Becker's Hospital Review previously reported at least five potential bidders expressed interest in acquiring athenahealth, including UnitedHealth and RCM company nThrive.

3. Former athenahealth CEO and co-founder Jonathan Bush will receive $4.8 million under a previously negotiated separation agreement. He also owns 900,000 shares in the company, valued roughly at $122 million.

4. Jeff Immelt, the former head of GE who served as athenahealth executive chairman, will receive $420,000 and shares worth $1.8 million.

5. The sale was apparently prompted by athenahealth's board, which was concerned that the company would be unable to meet financial expectations. The board cited declining market opportunities because customers rarely switch to athenahealth from competing platforms, a declining win rate and the need to spend more money on product development.

6. Top athenahealth executives will be offered a one-year severance package; a year’s bonus; nine to 12 months of medical and dental coverage; full vesting of unvested shares; and up to $10,000 in outplacement costs. That means current athenahealth CFO Marc Levine will receive about $5.5 million.

After the acquisition closes, Veritas plans to combine athenahealth with Virence Health, a value-based care business it acquired from GE Healthcare earlier in 2018.

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