Allscripts may be seeking buyer

Several news outlets have reported recently that EHR vendor Allscripts might be shopping around for a buyer, and at least one analyst says that might be a good idea.

Meanwhile, Allscripts has declined to comment.

[Also: Lessons in crisis management: Q&A with Allscripts CEO Glen Tullman]

“For competitive reasons, we don't discuss rumors or speculation,” Ariana Nikitas, Allscripts’ director of public relations, responded to an inquiry from Healthcare Finance News' sister pubiication Healthcare IT News.

Sean Wieland, a Piper Jaffrey senior analyst who tracks healthcare IT companies, including Allscripts, suggested in a September 28 brief that a sale could be the right course for Allscripts.

“We believe it is Allscript's responsibility to seek potential buyers considering the challenges the company has faced this year," Wieland wrote in the brief. “We believe finding the right buyer at the right price is no easy task.”

Wieland added that hiring a bank should be a last resort.

Both Bloomberg and Allscripts' hometown newspaper, The Chigago Tribune, have reported that Allscripts has hired Citigroup to give its executives advice on how to proceed. Bloomberg reported that its sources indicated there was no deal in the offing, and the company might decide against selling.

“In our view, management would not want to sell out at the bottom, and would only agree to hire a bank if all other options have failed,” Wieland wrote. “So this is potentially a sign that things have gotten incrementally worse, backing management into a corner on the decision to put the company up for sale.”

“Allscripts is holding talks about a potential leveraged buyout and spoken in recent weeks with firms such as Blackstone Group LP,” Bloomberg news reported.

Dogging Allscripts in the past year have been problems integrating products after its 2010 merger with Eclipsys and, apparently, difficulties merging cultures. Last April Allscripts fired its board chairman, Phil Pead, who had joined the company in the Eclipsys merger. It also posted a dismal quarterly report that sent the stock price plunging. The company has been trying to recover ever since, and has garnered the vocal support of many of its clients.