Acquiring High-Performance Healthcare Company for Approximately $670 Million by Machinify
In a significant move, Machinify, an AI-powered healthcare intelligence company, has agreed to acquire Performant Healthcare for approximately $670 million. The deal, which is expected to close by the end of 2025, subject to regulatory and shareholder approval, marks a strategic move to enhance capabilities in healthcare payment integrity and analytics.
The acquisition will see Machinify integrate Performant's payment integrity and eligibility analytics with its AI-driven healthcare intelligence platform. This integration aims to broaden market leadership by serving more health plans and beneficiaries, achieve improved financial outcomes and operational efficiencies for healthcare payers through enhanced data analytics and AI, and accelerate innovation within the healthcare payment integrity space by combining complementary capabilities.
Performant Healthcare, a market leader in identifying, preventing, and recovering improper payments through advanced analytics and proprietary data, will bring its expertise to Machinify. The acquisition allows Machinify to deploy its AI-powered configurable platform to further optimize payment processes and reduce waste in healthcare spending.
David Pierre, CEO of Machinify, plans to combine Machinify's Payer Operating System with Performant's trusted domain expertise and differentiated data assets. The alignment of values, deep industry expertise, and complementary technologies is viewed as a key driver to amplify innovation and impact across the healthcare landscape, benefiting stockholders, clients, and employees alike.
Matt Holt, Managing Director and President of Private Equity at New Mountain Capital, which owns Machinify, sees the acquisition of Performant as consistent with their focus on reducing administrative inefficiencies through technology and data investments. He believes that the future of the U.S. healthcare system requires modernization of IT infrastructure, including patient-centric data networks.
The acquisition price for Performant stockholders is $7.75 per share in cash. Performant's CEO, Simeon Kohl, is proud of the success of Performant's market-leading solution for healthcare payers. He expressed his confidence in the future of the combined company, stating that it will deliver quality, timely payments at dramatically reduced administrative costs.
J.P. Morgan Securities is serving as the exclusive financial advisor to Machinify, while Truist Securities is serving as the exclusive financial advisor to Performant. Pillsbury Winthrop Shaw Pittman is acting as legal counsel for Performant, and Ropes & Gray is acting as legal counsel for Machinify.
After the closing, Performant's shares will be delisted from the Nasdaq. The combined company will support a broader range of clients, including the Centers for Medicare and Medicaid, and state and local governments. This acquisition is expected to accelerate innovation and drive greater transparency, efficiency, and value for health plan clients, serving a combined population exceeding 160 million lives.
In summary, the strategic rationale behind Machinify's acquisition of Performant Healthcare is to combine and enhance their capabilities in healthcare payment integrity and analytics, leveraging advanced technology and AI to improve financial outcomes for health plans. The acquisition represents a 139% premium to Performant's 90-day volume-weighted average price. The deal has been approved by Performant's board of directors.
In alignment with their focus on technology and data investments, Machinify, with backing from New Mountain Capital's Private Equity, will deploy its AI-powered platform to the health-and-wellness sector, integrating Performant Healthcare's science-driven payment integrity services. By combining their expertise in technology and science, the merged entity aims to boost innovation within the health-and-wellness sector, particularly in the realm of healthcare payment integrity and analytics.
The acquisition by Machinify, a leading AI-powered healthcare intelligence company, will result in the deployment of advanced technology into the health-and-wellness sector, further optimizing payment processes and reducing waste in healthcare spending. This strategic move, expected to provide greater transparency, efficiency, and value for health plan clients, will serve a combined population exceeding 160 million lives, ultimately benefiting from the integration of technology and science.
