Three founding directors of UK health software company iSOFT have made a total of £21.5 million by selling a tranche of shares to General Atlantic Partners as part of an investment deal, according to a 4 March report in The Times.
In a 3 March financial release iSOFT said the sale of shares formed part of an investment of approximately £34.2 million in the company by General Atlantic Partners. iSOFT will raise cash proceeds of approximately £12.4 million.
Under the terms of the deal, General Atlantic will subscribe for 5,886,240 new ordinary shares in the Company, representing approximately 5% of the current issued share capital, and will purchase 10 million existing ordinary shares in the company from the founders of iSOFT – representing approximately another 10 per cent of issued share capital.
Following completion of the transaction General Atlantic will have a 12.8% shareholding in iSOFT. Patrick Cryne, chief executive of iSOFT, will see his shareholding in the company reduced to 9.7% following his sale of 5 million ordinary shares at a price of 215 pence per share – for an estimated total of £10.75 million.
General Atlantic is a global investment firm focused exclusively on information technology, process outsourcing and communications businesses. The firm has an impressive existing portfolio of investments in US and European healthcare IT firms. These include: Proxymed, a US electronic healthcare transaction processing services company; HEALTHvision, a US provider of Internet healthcare solutions; GWI, a German provider of hospital information technology solutions; and Eclipsys, a leading US provider of healthcare information systems and services for large hospitals and integrated delivery networks.
iSOFT has been variously tipped by financial analysts as being one of the possible beneficiaries of the NHS National IT Programme, which is set to invest an additional £2.3 billion in NHS IT over the next three years. The first contracts for the programme are scheduled to be awarded from late 2003.
Commenting on the transaction, Mr Cryne said: "As the size and volume of deals within our markets accelerate, we believe our customers will be increasingly reassured to be dealing with a company that has real critical mass and significant financial backing.”
Rene Kern, Partner at General Atlantic, added: "We consider iSOFT to be the leading player in the UK healthcare information applications sector and one of the most significant players internationally. We are impressed with the Company’s high quality management team which has consistently executed its strategy and delivered profitable growth.
In a separate announcement iSOFT revealed that it had signed its first deal in mainland China, following the signing of an exclusive agreement with Beijing United Family Hospital. Under the deal the international hospital will deploy iSOFT’s patient management, business financials, pharmacy and knowledge-based orders solutions.