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Thoma Bravo to make NextGen Healthcare a private company in $1.8 billion acquisition

by John R. Fischer, Senior Reporter | September 08, 2023
Business Affairs
Thoma Bravo is acquiring NextGen Healthcare
Software investment firm Thoma Bravo is taking NextGen Healthcare private, acquiring the company at $23.95 per share in cash.

According to Reuters, this adds up to $1.8 billion, including debt.

The news sent company shares soaring on the morning of September 6 by 14% in premarket trading, with the price per share representing a 46.4% premium to its unaffected closing stock price on August 22 and a 39.2% premium to the 30-day volume-weighted average price for the period ending September 1, reported Reuters.

NextGen Healthcare develops cloud-based EHR and practice management software for ambulatory care practices and other providers. Following the completion of the transaction, the company will no longer be listed on any public stock exchange, ending a 41-year run as a publicly traded company, according to Crain’s Chicago Business.

“With Thoma Bravo as a partner, the company will benefit from increased capital, expertise, and strategic flexibility to accelerate the company’s leadership in providing healthcare technology solutions,” said David Sides, president and chief executive officer of NextGen Healthcare, in a statement.

Reuters reported on August 23 that the company was exploring a potential sale. The decision follows some of its clients cutting back on spending and a federal investigation that resulted in the company paying $31 billion earlier in the summer to settle accusations of misrepresenting its EHR software capabilities and paying users kickbacks to recommend it.

The whistleblowers in the False Claims lawsuit said that NextGen Healthcare illegally obtained certification that enabled providers to receive incentive payments from the government if they used its software. They also accused the company of falsely stating that its software could record vital signs and generate clinical summaries.

In addition to NextGen, Thoma Bravo acquired medication intelligence company Bluesight in July, and European healthcare analytics provider for hospitals, LOGEX in March.

The deal is subject to approval by NextGen Healthcare shareholders and regulatory bodies. The company says the transaction is not subject to a financing condition.

It is expected to close in the fourth quarter of 2023.

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