Premier Inc. (Nasdaq: PINC) is buying CECity Inc. for $400 million, as the appetite for health care technology remains strong.
Pittsburgh-based CECity is a Software-as-a-Service provider that aims to help health care providers with performance management and improvement, reporting and professional education.
Premier, headquartered in Charlotte, North Carolina, provides services to more than 3,400 hospitals and 110,000 other providers, including data and analytics, collaborative services and supply chain offerings. The acquisition is expected to add more ambulatory and acute care performance-management services to the business.
“We are enhancing our capability to provide turn-key performance improvement and measurement reporting solutions in a rapidly expanding market,” says Susan DeVore, Premier CEO. “These capabilities are critical given the ongoing movement toward population health, as well as emerging Medicare requirements for all physicians to start reporting on a range of new performance measurements.”
The purchase price consists of $250 million in cash and $150 under the company’s untapped $750 million revolving credit facility. Reed Smith advised CECity on the deal.
The demand for health care technology has driven a slew of M&A transactions as providers play catch up to keep pace with demands of the Affordable Care Act. Recent transactions include Schryver Medical Sales and Marketing LLC’s acquisition of Main Street Clinical Laboratory Inc. and On-Site Imaging Solutions Inc., in July, and NantHealth’s deal for Harris Corp.’s (NYSE: HRS) commercial Healthcare Solutions business, also in July.
For more on the trend, see Health Care Industry Tech Catch-Up Drives Deals and 5 Technologies That Drove Health Care M&A in 2014. For more on how regulations are affecting health care M&A, see ACA Reshuffles the Deck.