In a deal designed to give the company more operating capital, MEDecision, Inc. has reached a merger agreement with one of its largest clients.
The deal, announced Wednesday, allows the Chicago-based Health Care Service Corporation to acquire all outstanding MEDecision shares for $7 per share in cash, a transaction valued at approximately $121 million. HCSC, which operates Blue Cross and Blue Shield plans in Illinois, New Mexico, Oklahoma and Texas, is the largest customer-owned health insurer in the United States and fourth largest health insurer in the country overall, with an estimated 12.4 million members.
"The transaction will deliver substantial current value to our shareholders and is a significant milestone for MEDecision and a very positive step forward in our evolution as a company," said David St. Clair, MEDecision's founder and CEO, in a press release. "It underscores the strength of our collaborative healthcare management solutions, Alineo and Nexalign. It also validates our vision of the healthcare industry and will enable us to further expand our technology development and strengthen our focus on customer service and satisfaction."
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This past April, MEDecision signed a contract with Blue Cross and Blue Shield of Florida to deliver its Alineo collaborative healthcare management platform. The integration, expected to continue into 2009, will allow BCBSF members to analyze, apply and automate payer-driven best practices.
The boards of directors of both companies have approved the transaction, which is expected to close late in the third quarter or early in the fourth quarter of this year. In addition, holders of approximately 45 percent of MEDecision's stock have entered into agreements with HCSC to approve the merger.
This past March, HCSC announced its participation in the launch of a network designed to deliver drug safety alerts to doctors via the Internet. The Health Care Notification Network (HCNN) is designed to replace paper notification, a key recommendation of the U.S. Food and Drug Administration.
"HCSC is committed to promoting accessible, cost-effective, quality healthcare through innovation and collaboration," said Pat Hemingway Hall, the company's president and chief operating officer. "We are excited about joining forces with MEDecision, who for two decades has demonstrated the same commitment to improving overall health outcomes with creative solutions that foster collaborative relationships between patients, payers and providers."
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