Acquisition to accelerate cloud-based development and delivery of
QSI/NextGen Healthcare core applications and elevate commitment to
ambulatory services sector with addition of clients
IRVINE, Calif.--(BUSINESS WIRE)--
Systems, Inc. (NASDAQ: QSII), announced today an agreement to
Holdings, Inc. (HealthFusion) for $165 million plus potential
additional contingent consideration of up to $25 million.
Based in San Diego, Calif., HealthFusion is a privately held developer
of web-based, cloud computing software for physicians, hospitals and
medical billing services. HealthFusion's 100 percent cloud-based
MediTouch® platform is currently used by over 3,000 physician practices,
hospital ambulatory centers and medical billing services (totaling more
than 6,000 subscribers). The company has historically achieved
meaningful double-digit annual revenue growth rates, with a recent
annualized revenue pace exceeding $30 million. The contingency for full
payment of the earn-out is based on the generation of $43 million of
HealthFusion product revenues during calendar 2016.
The transaction is subject to customary closing conditions and is
expected to be completed during the Company's current fiscal year, which
ends March 31, 2016. Quality Systems expects this transaction to be
accretive to its non-GAAP earnings in the first full year following the
The Company has secured $200 million in fully committed financing from
J.P. Morgan and U.S. Bank. At closing of the transaction, the Company
expects to fund approximately $115 million of the consideration via this
credit facility and the remainder through excess cash on hand.
"The acquisition of HealthFusion is another example of our strategy to
expand both client base and solution capabilities in our ambulatory
market. We look forward to sharing this acquisition as a part of our
broader strategy with our client base at our annual User Group Meeting
in Las Vegas starting this Sunday, November 1," said Rusty Frantz,
president and chief executive officer at Quality Systems, Inc.
"HealthFusion brings an extremely intuitive, fully mobile, cloud-based
solution that affords smaller groups of physicians and other providers a
clean EHR experience within a fully integrated suite of solutions for
their practice. Over time, we will focus on expanding the platform to
satisfy the needs of practices of increasing size and complexity. We
will also look to provide some of our broader service capabilities to
the HealthFusion client base," Frantz explained.
Dr. Sol Lizerbram, HealthFusion chairman, added: "We believe our
SaaS-based healthcare technology products will prove beneficial to
Quality Systems' NextGen Healthcare service offering as the Company
advances its cloud solutions capabilities. This acquisition presents
significant opportunity to capitalize on the joint successes both
companies have achieved to date in the ambulatory market segment."
J.P. Morgan Securities LLC is acting as financial advisor and Latham &
Watkins LLP is serving as legal counsel to Quality Systems. TripleTree
is acting as exclusive financial advisor and Wilson Sonsini Goodrich &
Rosati is serving as legal counsel to HealthFusion.
Quality Systems will host a conference call for the investment community
to further discuss the transaction on Monday, November 2, 2015 at 8:00
AM Eastern Time (5:00 AM PT). All participants should dial
1-866-900-9499 at least ten minutes prior to the start of the call and
reference conference ID #72447171. International callers should dial
1-937-502-2136. To hear a live Web simulcast or to listen to the
archived webcast following completion of the call, please visit the
Company's website at www.qsii.com,
click on the "Investors"
tab, then select "Conference
Calls," to access the link to the call. To listen to a telephone
replay of the conference call, please dial 800-585-8367 or 404-537-3406
and enter conference ID #72447171. The replay will be available from
approximately 11:00 AM ET on Monday, November 2, 2015, through 11:59 PM
ET on Monday, November 9, 2015.
Founded in 1998 by three entrepreneurs including two primary care
physicians, San Diego, Calif.-based HealthFusion supports over 6,000
ambulatory subscribers in more than 30 specialties spread across all 50
states and employs 140. HealthFusion develops web-based, cloud computing
software for physicians, hospitals and medical billing services.
HealthFusion's fully integrated solution includes MediTouch EHR
(Electronic Health Record and Patient Portal) and MediTouch PM (Practice
Management and Claims Clearinghouse).
MediTouch EHR was designed for use on mobile tablets such as the iPad,
and offers a unique array of features that facilitate adoption of EHR
technology. Each integrated module of the MediTouch platform natively
supports the iPAD® and the company is a certified Apple
Developer. All MediTouch modules function seamlessly together including
the EHR, medical billing, practice management, collections, patient
portal, and clearinghouse.
To learn more visit HealthFusion.com
or follow HealthFusion on Facebook,
Quality Systems, Inc.
Irvine, Calif.-based Quality
Systems, Inc. and its NextGen
Healthcare subsidiary develop and market computer-based practice
management, electronic health records and revenue cycle management
applications as well as connectivity products and services for medical
and dental group practices. Visit www.qsii.com
for additional information.
Certain statements in this news release are forward-looking
statements within the meaning of the federal securities laws, including
but not limited to those related to the projected closing date of the
transaction, the outlook and anticipated financial performance of
HealthFusion, the Company's intended sources of funding for the
acquisition, the anticipated accretive nature of the transaction to the
Company and the growth prospects for HealthFusion and the Company. These
forward-looking statements may contain the words "believe,"
"anticipate," "continue," "expect," "plan," "potential," "predict,"
"estimate," "outlook," "project," "will be," "will continue," "will
likely result," or other similar words and phrases. Risks and
uncertainties exist that may cause results to differ materially from
those set forth in these forward-looking statements. Factors that could
cause the anticipated results to differ from those described in the
forward-looking statements include, but are not limited to, the ability
to obtain required regulatory approvals for the transaction, market and
financial conditions which may impact the financial performance of
HealthFusion and general economic conditions as well as those risks set
forth in the Company's public filings with the U.S. Securities and
Exchange Commission, including the discussion under the heading "Risk
Factors" in the Company's most recent Annual Report on Form 10-K and any
subsequent Quarterly Reports on Form 10-Q. The Company expressly
disclaims any intent or obligation to update these forward-looking
statements except as required by law.
© 2015 Quality Systems, Inc., Irvine, CA 92612
owned by Quality Systems, Inc.
All other non-QSI Marks are
the property of their respective owners
View source version on businesswire.com: http://www.businesswire.com/news/home/20151030006051/en/
For Media and Public Relations Inquiries Contact:
Michelle Rovner, 215-657-7010
Investor Relations Inquiries Contact:
Quality Systems, Inc.
J. Lewis, 954-389-3700
Source: Quality Systems, Inc.
News Provided by Acquire Media