Blackstone Group LP (BX) is in talks to purchase Emdeon Inc. (EM), a provider of billing systems and software for health-care companies, for more than $3 billion, including debt, said a person with knowledge of the deal.
There is no guarantee a deal will be reached, said the person, who declined to be identified because the discussions are private.
Emdeon, based in Nashville, Tennessee, has been a public company since an IPO in 2009. Previously it was owned by Hlth Corp., which sold a majority stake to Greenwich, Connecticut- based General Atlantic LLC for $1.2 billion. Hlth, also the parent of medical-data site WebMD Health Corp. (WBMD), sold the rest to private-equity firm Hellman & Friedman LLC and General Atlantic for $575 million.
“If this is true, within two years they are going back and becoming a private company,” said Steven Halper, an analyst at Stifel Nicolaus & Co. in New York, in a telephone interview. “That’s generally a good thing. The company in the two years it has been public hasn’t necessarily executed on the bigger game plan it put out.”
Christine Anderson, a Blackstone spokeswoman, declined to comment. Tommy Lewis, an Emdeon spokesman, didn’t immediately return phone calls or e-mails seeking comment.
$1 Billion Sales
Emdeon generated $1 billion in sales last year, up 9 percent from a year earlier, on its systems that help health- care providers and payers manage claims and billings. The company’s network includes 340,000 providers, 1,200 government and commercial payers, 5,000 hospitals, 81,000 dentists and 60,000 pharmacies, according to its website.
As a closely held company, Emdeon could invest in the business without worrying about reporting quarterly earnings, said Stifel’s Halper.
The Wall Street Journal reported the discussions earlier today. Emdeon rose 22 percent to $16.10 at 4 p.m. in New York Stock Exchange composite trading, valuing the company at $1.86 billion.