DGAP-News: Cerner to Acquire Siemens Health Services for $1.3 Billion

DGAP-News: Cerner to Acquire Siemens Health Services for $1.3 Billion

DGAP-News: Cerner Corporation
Cerner to Acquire Siemens Health Services for $1.3 Billion

05.08.2014 / 22:55


 Acquisition to further industry innovation with a combined $650 million annual
                               R&D investment

                Complementary client bases expand global presence

Cerner and Siemens AG to combine strengths to deliver new solutions through $100
                           million strategic alliance

KANSAS CITY, Mo., Aug. 5, 2014 (GLOBE NEWSWIRE) -- Cerner Corporation
(Nasdaq:CERN) and Siemens AG today announced they signed a definitive agreement
for Cerner to acquire the assets of Siemens' health information technology
business unit, Siemens Health Services, for $1.3 billion in cash. By combining
investments in R&D, knowledgeable resources, and complementary client bases,
the acquisition creates scale for future innovation. As part of the agreement,
Cerner and Siemens will form a strategic alliance to bring new solutions to
market that combine Cerner's health IT leadership and Siemens' strengths in
medical devices and imaging. 

'We believe this is an all-win situation for the clients of both organizations
and all of our associates and shareholders,' said Neal Patterson, Cerner
chairman, CEO and co-founder. 'Through more than $4 billion of cumulative
investments in R&D, Cerner has established a strong market standing and is
positioned for continued growth. Siemens' health care IT assets provide
additional scale, R&D, an impressive client base, and knowledgeable and
experienced associates who will help Cerner achieve our plans for the next
decade. In addition, the alliance we're creating will drive the next generation
of innovations that embed information from the EMR inside advanced diagnostic
and therapeutic technologies, benefitting our shared clients.' 

Based on 2014 estimates, Cerner and Siemens Health Services have combined
totals of more than: 

  -- 20,000 associates in more than 30 countries
  -- 18,000 client facilities, including some of the largest health care
     organizations in their respective countries
  -- $4.5 billion of annual revenue
  -- $650 million of annual R&D investment

The transaction is expected to be more than $0.15 accretive to Cerner's
non-GAAP diluted EPS in 2015, and more than $0.25 accretive in 2016. Non-GAAP
earnings are expected to exclude share-based compensation expense, one-time
transaction costs, and acquisition-related amortization and deferred revenue

'We are excited to join with one of the most competitive companies in health IT
today, and a recognized leader in innovation,' said John Glaser, Ph.D., CEO of
the Health Services business unit of Siemens Healthcare. 'Siemens cares deeply
about its clients and believes Cerner is the best organization to fully support
their health IT needs going forward. The knowledge and strength of our combined
resources opens up great possibilities for future collaboration and
development, which is exciting for all of us. And our clients will benefit from
our alignment with a company that has such a strong historical and future
commitment to rapid innovation.' 

Cerner has a 35-year history of creating value for clients by providing
innovative solutions and services that help health care providers around the
world increase safety, improve quality and reduce waste. Cerner is
well-positioned to help clients be leaders in health care delivery and
population health management today and tomorrow. The company's competitive
market position, combined with significant investments in R&D, understanding of
advances in science and IT, as well as health care regulatory and industry
shifts, enable it to help clients succeed. 

'We have tremendous respect for Siemens' clients, their markets and their
needs,' said Patterson. 'We look forward to bringing them into the Cerner
family, especially as they face increasingly complex clinical and regulatory
environments, with mandates to improve quality and pressures to lower cost. We
pride ourselves on helping clients navigate changing times so they can be
leaders in providing care to their communities. We're committed to supporting
Siemens' clients, and we want them to have confidence that we have the vision,
scale and resources to help them achieve their plans for building their
organizations' futures.' 

Following the acquisition, support for Siemens Health Services core platforms
will remain in place. Current implementations will continue, and Cerner plans
to support and advance the Soarian platform for at least the next decade.
Cerner will work with all clients to support their short-term and long-term
business needs. 

Global Alliance

Cerner and Siemens will create a strategic alliance to jointly invest in
innovative projects that integrate health IT with medical technologies for the
purpose of enhancing workflows and improving clinical outcomes. Each company
will contribute up to $50 million to fund projects of shared importance to both
companies and their clients. 

The alliance has a three-year initial term. Advanced workflows along with
medical images and their unique role in diagnostic and therapeutic
decision-making, will be an early focus of the joint work. 

'Siemens is very innovative around imaging, diagnostic and therapeutic
technologies and processes,' said Patterson. 'Medical technologies generate
mountains of images and other data that must be stored, accessed, visualized
and interpreted intelligently. In addition, advanced diagnostic and therapeutic
processes are enhanced by presenting EMR data at just the right moment and in
the right context. Together we will innovate at the edge where IT, processes
and technologies meet.' 

Transaction Summary

Cerner intends to finance the acquisition with cash on hand. The acquisition is
expected to close in the first quarter of 2015, subject to regulatory approval
and other customary conditions. The transaction has been approved by the boards
of Cerner and Siemens. 

Greenhill & Co. is acting as financial advisor to Cerner, and Latham & Watkins
LLP is acting as its legal counsel. JP Morgan is acting as financial advisor to
Siemens, and Clifford Chance LLP is acting as its legal advisor. 

Conference Call

Cerner will host a conference call for the investment community to discuss the
acquisition at 4p.m. CT on Tuesday, Aug. 5. The dial-in number for the
conference call is (617) 614-4909; the passcode is Cerner. Cerner recommends
joining the call 15 minutes early for registration. The re-broadcast of the
call will be available from 8 p.m. CT, Aug. 5 through 11:59 p.m. CT, Aug. 12.
The dial-in number for the re-broadcast is (617) 801-6888; the passcode is

A webcast and slides that will be discussed on the call will be available on
Cerner's website at www.cerner.com under the About Cerner section (click
Investor Relations, then Presentations and Webcasts). 

About Cerner

Cerner's health information technologies connect people, information, and
systems, at approximately 14,000 facilities worldwide. Recognized for
innovation, Cerner solutions assist clinicians in making care decisions and
enable organizations to manage the health of populations. The company provides
clients with a wide range of in-house services, as well as an integrated
clinical and financial system to help organizations manage revenue. Cerner's
mission is to contribute to the systemic improvement of health care delivery
and the health of communities. (Nasdaq:CERN) For more information about Cerner,
please visit www.cerner.com, check out our blog at www.cerner.com/blog and
connect with us on Twitter at http://www.twitter.com/cerner and on Facebook at

Certain trademarks, service marks and logos set forth herein are property of
Cerner Corporation and/or its subsidiaries. All other non-Cerner marks are the
property of their respective owners. 

All statements in this press release that do not directly and exclusively
relate to historical facts constitute forward-looking statements. Statements
relating to the expected benefits of the proposed transaction and Cerner's
post-transaction plans, objectives, expectations and intentions are examples of
such forward-looking statements. These forward-looking statements are based on
the current beliefs, expectations and assumptions of Cerner's management with
respect to future events and are subject to a number of significant risks and
uncertainties. It is important to note that Cerner's performance, and actual
results, financial condition or business could differ materially from those
expressed in such forward-looking statements. In many instances, the words
'plans,' 'estimates,' 'intends,' 'believe,' 'position,' 'expects,' 'will' or
the negative of these words, variations thereof or similar expressions are
intended to identify such forward-looking statements. Factors that could cause
or contribute to such differences include, but are not limited to: risks
inherent with business acquisitions and integrations such as difficulties and
operational and financial risks associated with integrating Cerner and the
acquired business; the occurrence of any event, change or other circumstances
that could give rise to the termination of the transaction agreements; the risk
that the necessary regulatory approvals may not be obtained in a timely manner
or may be obtained subject to conditions that are not anticipated; the risk of
uncertainty as to timing of the consummation of the acquisition; risks that any
of the closing conditions to the proposed transaction may not be satisfied or
may not be satisfied in a timely manner; risks related to disruption of
management time from ongoing business operations due to the proposed
transaction; failure to realize the synergies and other benefits expected from
the proposed transaction; risk that the assets and business acquired may not
continue to be commercially successful; the effect of the announcement of the
proposed transaction and the transaction itself on the ability of Cerner to
retain customers and retain and hire key personnel and maintain relationships
with key suppliers; unexpected costs, charges or expenses resulting from the
transaction; and litigation or claims relating to the transaction or the
acquired assets and business. Additional discussion of other risks,
uncertainties and factors affecting Cerner's business is contained in Cerner's
filings with the Securities and Exchange Commission. The reader should not
place undue reliance on forward-looking statements, since the statements speak
only as of the date that they are made. Cerner undertakes no obligation to
update forward-looking statements to reflect changed assumptions, the
occurrence of unanticipated events or changes in future operating results,
financial condition or business over time. 

         CONTACT: US Media:
         Kate O'Neill Rauber
         +1 816-888-2880
         EU Media:
         Distie Profit
         +44 (0)77 8978 1815
         Cerner Investors:
         Allan Kells
         (816) 201-2445
News Source: NASDAQ OMX


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Language:    English             
Company:     Cerner Corporation  
             United States       
ISIN:        US1567821046        
End of News    DGAP News-Service  
280981 05.08.2014                                                      
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