$12M Deal: Compuware Acquires Cary Firm Focused on Healthcare Records
Posted March 2, 2006 10:41 a.m. EST
CARY, NC — Compuware
, a privately held software company based in Cary that is focused on healthcare records solutions in an all-cash deal worth $12 million.
ProivderLink, which was launched in 2000 by serial entrepreneur David Gardner, will be integrated with Covisint, a subsidiary of Compuware. Compuware is based in Detroit.
Gardner will remain with Covisint as a vice president, he told WRAL Local Tech Wire in an interview.
"It was a good deal," Gardner said. "It's about six-times our earnings, which we think is reasonable."
The price of the deal was disclosed in an SEC filing.
"Substantially all" of ProviderLink's 30 employees will become part of Covisint, the companies said in a statement. ProviderLink will be the name of the product Covisint sells utilizing ProviderLink technology.
The companies have been in negotiations for some four months. "We really weren't looking to sell the company," Gardner said. "This began as a business development opportunity. Compuware quickly turned it into an acquisition."
Both Covisint and ProviderLink were tackling the challenge of assisting healthcare providers at all levels deal with medical records.
"I am really excited about the synergies between the companies," Gardner said. "We were handling data from the unstructured standpoint and they were handling structured data. This is just the right combination to build a national healthcare network."
Through Covisint, Compuware was entering the healthcare vertical market. Covisint already claims customers outside of healthcare for other services in some 90 countries.
"ProviderLink complements Compuware Covisint's growing presence in the healthcare industry," Gardner said in a statement. "By joining forces, Compuware Covisint and ProviderLink can accelerate the adoption of a solution that all healthcare delivery organizations, government agencies and payors can use to more effectively manage all of their communications with each other."
ProviderLink offers healthcare providers a web-enabled suite of tools to help those still utilizing paper records to interact with partners who utilize electronic systems.
Covisint, which recently landed a contract with General Motors, has developed its own set of collaboration tools for secure record exchange.
"This transaction brings Compuware Covisint a powerful, web-enabled application that - through effective management and sharing of healthcare communications and records - reduces healthcare costs and increases quality of care," said Bob Paul, president and chief operating officer of Covisint, in a statement. "ProviderLink will represent a key feature of Covisint's healthcare strategy, eliminating redundant and hard-to-track phone, postal and telephonic business processes."
Among the investors in ProviderLink is Blue Cross and Blue Shield of North Carolina.
Gardner helped found several firms, including Peopleclick, Report2Web, OnSphere, BuildLinks and DBBasics.