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Mercom Capital Group, llc, a global market intelligence, consulting and
communications firm, today released 2010 funding and merger and
acquisition (M&A) activity for the healthcare IT sector.
The Healthcare IT sector had $211 million in venture capital (VC)
funding in 2010 in 22 deals. Sixty-two different investors participated
in these funding rounds. $629 million was raised by Healthcare IT
companies outside of VC funding, through various forms of debt and
credit facilities, which is a positive sign for the sector. Significant
VC transactions included a $60 million Series C raise by Castlight
Health, a $30 million raise by PatientSafe Solutions and a $20 million
Series D raise by Phreesia. The top five investors in the sector for
2010 included VantagePoint Venture Partners, Long River Ventures,
Morgenthaler Ventures, OpenView Venture Partners and Osage Partners.
M&A activity was robust in the Healthcare IT sector totaling almost
$4 billion in 85 different deals. Only 21 deals were disclosed,
indicating a much larger M&A activity number. Notable transactions
included the $1.3 billion merger of Allscripts and Eclipsys, the
acquisition of Phase Forward by Oracle for $685 million and the
acquisition of Medicity by Aetna for $500 million. "Consolidation and
strategic acquisitions among Healthcare IT companies helped fuel this
surge in M&A activity," commented Raj Prabhu, Managing Partner at
Mercom Capital Group.
To download healthcare IT funding reports, visit: http://mercomcapital.com/healthcareitreports.php
Download charts and graphs: Healthcare IT 2010.
Healthcare IT - Fourth Quarter
VC funding activity decreased in Q4 coming in at $11 million in five
transactions out of which three were disclosed, compared to $62 million
for seven transactions during Q3. Notable VC transactions included a
Series A raise of $7.5 million by DICOM Grid and a $2.6 million raise by
Halfpenny Technologies. Debt and other funding activity amounted to
$567 million in two disclosed transactions, Agfa's $130 million loan by
the European Investment Bank and the $394 million loan provided to
CompuGroup Medical underwritten by SEB.
M&A activity for the sector saw a surge in the number of deals
compared to Q3. Out of 30 M&A transactions, seven were disclosed for
a total of $860 million compared to the third quarter that had a total
of 19 deals of which three were disclosed for $326 million. The $500
million acquisition of Medicity by Aetna and the $250 million
acquisition of PHNS by The ConJoin Group were the notable transactions
that took place in Q4.
Mr. Prabhu continued, "Healthcare IT funding steadily dropped in Q4,
while the number of M&A transactions almost doubled, indicating that
we might be seeing some consolidation in the industry."
To download healthcare IT funding reports, visit: http://mercomcapital.com/healthcareitreports.php
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