Tech Mahindra to acquire US-based healthcare IT services firm

IT Firm Tech Mahindra on Monday announced it has signed an agreement to acquire a US-based healthcare Information Technology consulting company CJS Solutions Group LLC, which does business as The HCI Group.

Tech Mahindra will make an upfront payment of $89.5 million for purchase of 84.7 per cent stake in the company. The balance stake of 15.3 per cent will be acquired over a period of three years, it said.

The move is expected to strengthen position in healthcare provider space and give access to marquee customers and healthcare consultants, the statement added.

"Healthcare is one of the few sectors globally that is driving adoption of digital technologies. The acquisition will not only position Tech Mahindra as a significant player in the healthcare provider space, but will also provide an opportunity to go deeper in this space via EMR implementation and surrounding services route," said CP Gurnani, MD & CEO of Tech Mahindra.

Headquartered in Jacksonville, The HCI Group works with global Tier-I healthcare service providers, primarily in the US and UK, focusing on providing end-to-end implementation of Electronic Health Record (EHR) and Electronic Medical Record (EMR) software, training and support services.

The HCI Group has a large pool of 'Epic' and 'Cerner' (healthcare software) certified professionals, and it is a leading implementation firm for these companies globally, it said. For 12-month period ended September 20, 2016, HCI Group had revenues of USD 114 million.

The Enterprise Value is USD 110 million. The transaction is expected to close by April 2017, subject to the regulatory approvals.