Sage to buy Emdeon Practice Services for £297-m

NEW DELHI: The Sage Group plc today said it is to acquire Tampa, Florida-based Emdeon Practice Services (EPS) Inc. from its parent company Emdeon Corporation, for an enterprise value of approximately £297 million, to be paid in cash and financed through Sage’s existing credit facilities.

The acquisition is expected to complete in September, subject to regulatory approvals.

EPS revenue for the year ended December 31, 2005 was approximately £160.3 million. Earnings before interest, tax, depreciation and amortisation were approximately £11.4 million. The company had gross assets of approximately £37 million as at December 31, 2005.

With 20,000 customers, EPS is a leading vendor of software and services for doctors' practices in the US, most of which are small or medium-sized businesses. EPS software is used in practice management and in the maintenance of patient data.

This includes administrative and financial processes such as appointment scheduling, prescriptions and billing, together with the creation and management of electronic health records.

EPS support services include software maintenance and, additionally, access to electronic medical transaction services such as those facilitating claims to healthcare insurers.

Paul Walker, Sage chief executive, commented, "Acquiring Emdeon Practice Services enables Sage to market its products and services to a substantial new community of small and medium-sized businesses in the US. This market is showing clear demand for automation of business processes. This acquisition continues our strategy of providing industry-specific solutions, by bringing dedicated Sage solutions to this business sector for the first time.

The growing doctors' practices market provides opportunities to offer an integrated Sage solution to both new and existing Sage customers in the US, covering accounting, health records and practice management. Emdeon Practice Services will now form the basis for a new doctors' practices division, which we aim to grow both organically and through further acquisitions."

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