US-headquartered IT services giant CSC today revealed it had closed the acquisition of troubled Australian e-health player iSOFT, in a move that will finally give CSC full control over the company it has long partnered with in the UK Government’s makeover of its national health technology systems, and will bring long-awaited stability to iSOFT’s operations.
CSC and iSOFT have long worked together on the UK’s massive National Programme for IT as part of the country’s National Health Service. The project utilises the Lorenzo e-health platform developed by iSOFT before it merged with Australia’s IBA Health.
However, iSOFT has been struggling financially for some time. In February the company published its half-yearly financial results, revealing that its revenues had slipped from $222 million for the same period 12 months ago to $167 million. The company made a net loss of $84 million — compared with a modest profit of $4.8 million a year earlier.
In early April, CSC announced its intention to buy iSOFT, noting the move would see iSOFT’s 3,300 employees scattered around the globe and in Australia added to CSC’s ranks — as well as adding more than 13,000 customers to the IT service provider’s e-health roster.
“The completion of this acquisition is a milestone in the expansion of our global healthcare business,” said Michael W. Laphen, CSC chairman, president and CEO, in a statement today. “Joining forces with CSC is a major step forward for iSOFT, putting us in a position to accelerate the delivery of our Innovation Agenda”, added Andrea Fiumicelli, former CEO of iSOFT and newly-appointed Chief Operating Officer of CSC’s healthcare business.
“By combining both organisations we have created a major force in the healthcare industry with significant opportunities for future growth through richer solutions and much enhanced access to the global market. Building on this platform, our ambition is to become one of the world’s leading healthcare IT suppliers.”
Lisa Pettigrew, CSC Australia’s national director for Health Services, also had positive words to say about the acquisition. “Today is an exciting day for both CSC and iSOFT,” the executive said. “The acquisition is now complete and iSOFT is a CSC company. In this region we are welcoming over 300 iSOFT staff from Australia and New Zealand into the CSC family. Together, we will serve existing clients with increasing effectiveness as well as access new and exciting opportunities in emerging markets.”
“Here in Australia, the acquisition of iSoft by CSC will see the convergence of data, products, services and devices for the new eHealth and telehealth world. CSC is now in a good position to help provide sustainable eHealth solutions that incent clinical users appropriately. Centrestage will be the linking of all aspects of healthcare delivery in ways that will completely change the efficiency of healthcare.”
The acquisition process has not been without hiccups. In mid-April former iSOFT executive chairman Gary Cohen, who controlled a block of shares in the company, filed legal proceedings in what appeared to be an attempt to block the acquisition. The case was thrown out by the NSW Supreme Court in late May, however, with the court finding Cohen’s action was without foundation.
Image credit: Marcin Jochimczyk, royalty free