Allscripts (MDRX) to sell CarePort Health business to WellSky for $1.35 Billion

Allscripts (NASDAQ: MDRX) announced today the execution of a definitive agreement to sell its CarePort Health (“CarePort”) business to WellSky Corp., a global health and community care technology company. WellSky is jointly owned by two of the world’s largest private equity firms, TPG Capital and Leonard Green & Partners.

CarePort solutions assist hundreds of hospitals and thousands of post-acute care providers to efficiently coordinate and transition patients through different settings of care.

The agreed sale price of $1.35 billion represents a multiple of greater than 13 times CarePort’s revenue over the trailing 12 months, and approximately 21 times CarePort’s non-GAAP Adjusted EBITDA over the trailing 12 months. CarePort is included in Allscripts Data, Analytics and Care Coordination reporting segment and represents approximately 6% of Allscripts consolidated revenues. Reference should be made to the Allscripts quarterly earnings reports and supplemental financial data for a reconciliation of non-GAAP Adjusted EBITDA.

The transaction is expected to close before the end of the year, subject to receipt of regulatory clearances and satisfaction of other customary closing conditions. Upon transaction close, the CarePort client base and associates will transition to WellSky. The two companies will operate independently until that date. Allscripts expects the net after-tax proceeds to be used to invest in its solutions, further deleverage the company’s balance sheet and support significant share repurchases.

“WellSky is a great company that will provide both an ideal and permanent home for CarePort and its almost 200 team members,” said Rick Poulton, Allscripts President and Chief Financial Officer. “This agreement is another all-around win for Allscripts as it unlocks significant value for our shareholders, enables us to increase our focus on our core business and brings our CarePort customers the benefit of continued investment under new and very strong ownership.”

“Together with CarePort, WellSky will establish new, meaningful connections between historically disparate settings of care. We have the exciting opportunity to bring care coordination to more providers in service of delivering more informed, personalized care,” said Bill Miller, CEO of WellSky. “Through this agreement, we’re ensuring our clients have the intelligent technology they need to do right by their patients, collaborate with payers, and succeed in value-based care models. It’s WellSky’s mission to realize care’s potential, and this moves us that much closer to achieving it.”

William Blair and J.P. Morgan Securities, LLC acted as financial advisors to Allscripts in connection with the sale of CarePort. Additional details regarding the sale will be made available in a Form 8-K to be filed by Allscripts with the Securities and Exchange Commission.

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