Allscripts, Eclipsys to merge for $1.3B

I got this via Wall Street Journal although there are various announcement on this all over the health informatics industry

Health-care IT providers AllscriptsMisys Healthcare Solutions Inc. and Eclipsys Corp agreed to merge in an all-stock deal valued at about $1.3 billion, creating an entity whose combined technology will make it easier for hospitals, nursing homes and doctors’ offices to share patients’ health information electronically.

Under the terms of the deal, announced Wednesday, Eclipsys shareholders will receive 1.2 Allscripts shares for each Eclipsys share. That’s a 19.4% premium to Eclipsys’s Tuesday closing price of $18.51.

Chicago-based Allscripts currently offers software and other IT-related solutions to doctors’ offices, while Eclipsys focuses on providing similar services to hospitals and nursing homes.

Allscripts Chief Executive Glen Tullman will lead the combined company, and Phil Pead, president and chief executive of Eclipsys, will be its chairman.

“The merger of Allscripts and Eclipsys creates one company with the scale, breadth of applications and client footprint to bring that vision to life by connecting providers in hospitals, physician practices and post-acute organizations across the country,” said Mr. Tullman in a statement.

The combined company will reach one out of every three U.S. doctors as well as one-third of all U.S. hospitals that have 200 or more beds.

More and more health-care providers are expected to adopt electronic health records to avail themselves of $30 billion in financial incentives beginning next year, under the Obama administration’s stimulus package.

The merger of Allscripts and Eclipsys is timed to take advantage of this huge change in the way doctors and hospitals access their patients’ health information, people familiar with the matter said.

As part of the deal, Allscripts plans to buy back shares from Misys, a U.K.-based information services company that owns 55% of Allscripts.

Misys will also sell a portion of its Allscripts shares through a secondary offering, leaving it with a roughly 10% stake in the combined company, people familiar with the matter said.

UBS is acting as financial adviser to Allscripts, Perella Weinberg is advising Eclipsys and Credit Suisse is advising Misys.

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