Looks like the rumors are based in fact; case management/bill review vendor Genex is up for sale.
The “official” news came yesterday (thanks to a good friend for the tip); “The Wayne, Pennsylvania-based company has EBITDA of USD 40m, the source and the first industry banker said. Bank of America has been mandated for the sale process, according to the source familiar. The sale process is in the early stages, with no first round bid deadline yet set, a third industry banker said.”
With top line revenues estimated at $390-$400 million, it’s not a terrifically profitable entity, but then case management is not known as a big cash generator. They’ve made a couple acquisitions lately, with Intracorp by far the largest.
Looks like Genex’ owner, Stone Point Capital, may be entering the divesting phase. Recall SPC also has ownership in Sedgwick and Stone River/Progressive Medical, although the latter property was only recently acquired. As CIGNA is also an owner, they could be pressuring Stone Point to sell Genex; pretty much every health plan is looking for capital to invest in preparing for 2014, and CIGNA would get a chunk of cash from a sale.
Timing is good – valuations are up, there’s lots of activity and interest, and a couple of big-money folks are looking for roll-up and industry integration opportunities. Genex would be a pretty interesting cornerstone for such a venture.
What does this mean for you?
Hold on to that hat – this isn’t going to be the last big deal we’ll see this winter.
Jan
23
