American Thoma Bravo is in Agreement to Acquire EHR Major NextGen Healthcare in $23.95 Per Share Deal

Under the terms of the deal, Thoma Bravo will acquire NextGen for $23.95 per share, representing a substantial 46% premium over NextGen's closing price on August 22.

US-based NextGen Healthcare, an electronic health record vendor, has entered into a private agreement with American private equity firm Thoma Bravo. 

Under the terms of the deal, Thoma Bravo will acquire NextGen for $23.95 per share, representing a substantial 46% premium over NextGen's closing price on August 22. The acquisition is anticipated to be finalised in the fourth quarter of this year.

This agreement follows recent reports from Bloomberg indicating that Thoma Bravo was in advanced discussions to acquire NextGen. In August, Reuters also reported that NextGen had engaged the services of investment bank Morgan Stanley to explore a potential sale.

Upon completing this transaction, NextGen, which boasts a customer base of over 100,000 healthcare providers across the United States, will transition into a private entity. 

Noteworthy among NextGen's clientele are accountable care organisations, independent physician associates, and managed service organisations. Approximately one-third of NextGen's covered lives are under the coverage of Medicare and Medicaid, as per their most recent 10-K filing.

Notable competitors in the field include Epic, Athenahealth, Oracle, and Veradigm.

Interestingly, this acquisition comes shortly after NextGen agreed to a $31 Mn settlement earlier in the summer, resolving allegations of violating the False Claims Act. These allegations centered on misrepresentations regarding versions of their product and offering unlawful incentives to encourage software referrals.

According to a report from research firm Pitchbook released in July, Thoma Bravo's foray into healthcare investments is relatively uncommon, constituting approximately 9% of its total investments. A significant portion of their investments, around 76%, is in information technology.

Within Thoma Bravo's portfolio of healthcare companies is Bluesight, a software supply chain enterprise concentrating on pharmacies and hospitals.

With assets under management exceeding $130 billion as of June this year, Thoma Bravo identifies itself as one of the largest software investors. 

Recent developments include acquiring identity and access management company ForgeRock in a transaction valued at approximately $2.3 billion and finalising their acquisition of business spend management company Coupa Software.