Orion Health sells portion of the business
July 4, 2018
AUCKLAND, New Zealand – Orion Health Group Limited announced that it has reached agreement in relation to Orion Health’s Rhapsody and Population Health businesses with private equity technology investor Hg.
The agreement is for entities managed by Hg to acquire majority ownership of Orion Health’s Rhapsody business and to invest in Orion Health’s Population Health business.
“Today we made an exciting announcement about investments in Orion Health’s Rhapsody and Population Health businesses from Hg, a specialist technology investor with a deep knowledge of the global healthcare technology sector,” said Ian McCrae (pictured), founder and CEO, Orion Health. “This investment provides Orion Health with a tremendous opportunity to deliver on our vision for customers, our people and for the healthcare sector.”
McCrae asserted that, “Hg will acquire Orion Health’s Rhapsody business, with Orion Health retaining 24.9% shareholding in that business. Hg will also take a 24.9% stake in Orion Health’s Population Health business. Orion Health’s Hospitals business will remain 100% owned by Orion Health. The injection of capital will provide investment for Orion Health to build leading global technology for the healthcare sector.”
For its part, Hg is a specialist technology investor committed to helping build global businesses with funds of c.£10 billion under management.
Healthcare technology is a core investment area for Hg, having recently completed a number of transactions across the sector. This investment will be made from Hg’s Mercury 2 Fund.
“Hg has been researching the theme of interoperability and population health management in healthcare IT over many years,” said David Issott, Partner, Hg. “We believe this is a key global growth theme backed by substantial market funding and resources. Rhapsody provides fantastic products and services for this market and we look forward to partnering with the team at Rhapsody to maximize its potential across the globe. We are also excited to work with Ian and the team to realize the full potential of the Population Health business.”
Orion Health built the first Rhapsody integration engine in the late-1990s, quickly becoming one of the most recognized interoperability platforms for healthcare organizations today.
The combination of Rhapsody’s global team and Hg’s resources will extend Rhapsody as a leader in the interoperability platform space, building on both Rhapsody’s world class technology and highly rated customer service.
Philippe Houssiau, an experienced global technology executive, will step in to lead the Rhapsody business and will join the new board of Population Health from closing. Philippe has broad experience in leading healthcare businesses, consulting and start-ups, and is formerly CEO of Agfa HealthCare, CEO of Alliance Medical and a Senior Partner with PwC.
“As the healthcare sector evolves, so too has Orion Health. We recently restructured our teams into three businesses focused on Rhapsody, Population Health and Hospitals, repositioning Orion Health around market potential and focusing dedicated teams to support customers, improve operating performance and drive growth,” said McCrae. “We remain committed to the ongoing success of Rhapsody and supporting customers across our entire Orion Health business.”
Orion Health believes the biggest advances in healthcare technology will come from advanced analytics and better dataflow to address critical issues within the sector. In the face of growing and aging populations and the rise of chronic diseases, health systems the world over are under enormous strain. The focus of Orion Health’s Population Health and Hospitals business is to help the sector optimise healthcare budgets and address the transformation necessary in the healthcare industry.
“This injection of capital will advance Orion Health’s businesses to reach their full potential over time. For our Population Health business, it will help strengthen our position as a market leader, and for our Hospitals business, it will further support its growth,” said McCrae. For more details, please see https://www.nzx.com/announcements/320296.