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Ideagen buys US-based healthcare software group Medforce for $8.7m
AIM-listed software company Ideagen has announced the acquisition of New York-based healthcare software group Medforce Technologies for $8.7m in cash.
The acquisition, which is the company's first in the US, is expected to be earnings-enhancing in the accounting period from 1 May 2018. It will be funded partly from existing cash reserves and partly from existing debt facilities.
Based in Suffern, New York, Medforce developed the 'Center' suite of enterprise information management, workflow and compliance software, which is used by more than 300 US healthcare customers including a number of Fortune 500 companies, to support business process productivity and legal compliance.
In the year to the end of December 2017, the company generated revenue of $4.7m, of which 82% is recurring.
Ideagen said the deal broadens its relationships in its existing core sector of healthcare, enhances the company's geographic customer footprint and provides an additional source of recurring revenue.
Chief executive officer David Hornsby said: "Medforce is a valuable addition to the group and is in line with our strategy of acquiring business that have valuable IP and strong recurring revenues. Medforce has established an extremely compelling value proposition and brings to the group a complementary solution offering, a talented workforce and long-term customer relationships which further strengthens our position in the US healthcare market."
At 0850 BST, the shares were up 2.8% to 112p.