Optum UK buying healthcare software group EMIS for $1.5 billion

Photo: Martin Barraud/Getty Images

Health Services firm Optum UK, a subsidiary of UnitedHeath Group, will acquire U.K.-based healthcare technology company EMIS for about $1.51 billion, the latter has announced.

According to information provided by the London Stock Exchange, Optum anticipates the deal will result in better services for the National Health Service (NHS), the state-run healthcare system serving residents of the U.K.

The filing said the consolidation would help strengthen EMIS' capabilities as a technology company and result in better patient care for those served by the NHS.

"Optum UK is focused on helping the NHS work better for clinicians and patients, and believes that this combination with EMIS will bring ever more advanced technology solutions and capabilities to the NHS and general practitioners to improve patient care," Optum UK CEO Rob Sergeant said by statement.

While the deal is not yet finalized, EMIS directors are expected to unanimously recommend that shareholders vote in favor of the deal.

WHAT'S THE IMPACT?

The filing indicates that Optum has operated within the U.K.'s NHS framework for about 20 years. In that country, it's focused primarily on population health management, which affects about 45 million people in the U.K.

EMIS CEO Andy Thorburn said by statement in the filing that the deal will enable the company to better support the NHS through technological innovation. The additional resources available to EMIS will accelerate its development, he said.

"We therefore consider that the combined group will be well positioned to serve its customers and partners in the UK's healthcare system," said Thorburn, "whilst ensuring EMIS remains a strong organization supporting the NHS, thereby fulfilling EMIS's purpose of enabling better care through technology innovation."

The announcement raised EMIS' stock price 47%, resulting in a market capitalization of about 1.2 billion pounds, or $1.47 billion.

THE LARGER TREND

Optum has made a number of deals in the U.S. lately as well. In May, the Massachusetts Supreme Judicial Court approved the Atrius-Optum merger that was originally conceived in 2021. The court approved the transaction with certain conditions, including the stipulation that Atrius will no longer be a public charity under Massachusetts law, once Atrius causes the net proceeds of the proposed transaction to be transferred to the Atrius Health Equity Foundation, and that it amend its articles of organization to remove its charitable purposes.

Meanwhile, Optum and Change Healthcare are extending their merger agreement to the end of the year, ahead of their scheduled trial starting August 1. The Department of Justice has sued to block the merger, citing anti-competitive concerns about data.

Optum and Change contend that their combination would connect and simplify the core clinical, administrative and payment processes of providers and payers, thus increasing efficiency and reducing friction in order to lower costs.

Optum has also announced intentions to merge with at-home healthcare service provider LHC Group. But a shareholder is suing Optum and its board of directors over the proposed merger, court documents show. Optum, which manages drug benefits and offers data analytics services and works with more than 100 health plans, announced the acquisition plan in March, saying it would purchase LHC Group for about $5.4 billion.

Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com