A New Development Throws a Wrench into the Athenahealth Saga

Sept. 18, 2018
The ongoing drama over the future of EHR vendor athenahealth seems to have entered a new phase, with a development that potentially throws a monkey wrench into its business process

The ongoing drama over the future of the Watertown, Massachusetts-based athenahealth appears to be continuing. Healthcare Informatics Managing Editor Rajiv Leventhal reported on Sep. 7 that “Elliott Management, a New York hedge fund led by billionaire Paul Singer, is the favorite to win the athenahealth takeover bid now that Cerner and UnitedHealth have declined an opportunity to acquire the health IT company, according to a report in the New York Post.”

Now, however, the situation seems abruptly to have changed. The New York Post reported on Monday that “Paul Singer’s Elliott Management has backed away from its $160-a-share bid for Athenahealth, The Post has learned. Singer, while getting cold feet at $160 per share, could be mulling a bid at a lower price, sources said. At the same time, other suitors — including some strategic companies that had made initial inquiries — have also gone quiet, sources close to the situation said.”

The Post’s Josh Kosman and Carleton English, who had also authored the newspaper’s Sep. 6 report, stated in yesterday’s article that, “As a result of Singer’s retreat and the lack of robust interest from others, athena has extended a final bid deadline by 10 days — to Sept. 27, sources said. Singer backing off the promised bid is a stark turnaround in the battle for the health care tech company,” they added.

What’s more, they wrote, “Elliott succeeded in a tough activist fight to get Athena to oust founder and chief executive Jonathan Bush, a cousin of former President George W. Bush, and to put the company up for sale.  Singer’s firm in May said it was prepared to pay $6.9 billion for Athena — contingent on due diligence.” And they quoted an unnamed source who told them, “There has been a lot of speculation on Elliott’s motives” for saying in May it was prepared to pay $160 a share. “It feels now like they never really wanted to own it” and were just setting a floor for the auction, the source told the reporters. athenahealth is a leading vendor of electronic health record and physician practice management solutions.

Healthcare Informatics will update readers on this story as new developments occur.