Alcidion completes acquisition of MKM Health and Patientrack
Completion of MKM Health and Patientrack acquisition with effect 3 July 2018
Creating a new leader in health informatics for smarter healthcare delivery
Ms Kate Quirke, former CEO of MKM Health, appointed CEO of Alcidion Group with Mr Ray Blight to remain Executive Chairman
Adelaide, South Australia, 3 July 2018 – Alcidion Group Limited (ASX: ALC), a provider of health informatics solutions, today announced that the acquisition of MKM Health Pty Ltd and Patientrack Holdings Limited (“the Acquisition”) which was announced to the ASX on 24 April 2018 has completed on 3 July 2018.
MKM Health is a leading provider of IT solutions to healthcare providers across Australia and New Zealand, and UK-based Patientrack is a world leading supplier of healthcare software targeted at improving patient safety in hospitals.
The Acquisition is transformative for Alcidion and creates a new and leading specialist healthcare IT solution provider focused on “next generation” decision intelligence and analytics technology with established customers across three geographic markets – the UK, Australia and New Zealand.
Completion of the Acquisition follows the satisfaction of conditions precedent and other completion requirements. These requirements included the receipt of Alcidion shareholder approval at an Extraordinary General Meeting held on 14 June 2018 to approve the issue of Alcidion shares as partial consideration for the Acquisition (of which 197,891,181 fully paid ordinary shares at a deemed issue price of 5.05c per share, equivalent to approximately A$10 million, were issued on completion). 160,354,152 of these ordinary shares will be subject to voluntary escrow for a minimum of 12 months following completion of the Acquisition.
The cash consideration of A$2 million (subject to completion adjustments) is expected to become payable to the MKM Health and Patientrack shareholders during the second and third quarters of the 2018/2019 financial year and will be funded from Alcidion’s existing cash reserves.
Further contingent consideration of up to A$4 million (to be satisfied by the issue of Alcidion shares at a deemed issue price of 5.05c per share) is payable to the MKM Health and Patientrack shareholders in 12 months subject to the revenue and EBITDA performance of MKM Health and Patientrack over the 12 month period.
As part of the transaction, Ms Kate Quirke, former CEO of MKM Health, has been appointed to the role of Chief Executive of the Alcidion Group, as well as an Executive Director to the Alcidion Board. Kate is a highly experienced executive with deep expertise in the healthcare IT sector. Ray Blight, previously Alcidion’s Chairman and CEO will move to the role of Executive Chairman and continue to have an active role in driving the future growth of the combined group.
A summary of the material terms of Ms Quirke’s appointment is detailed at the end of this release.
“We’re pleased to have completed the acquisition of MKM Health and Patientrack, and we look forward to welcoming their employees, integrating their software products and technologies as well as working with their client base,” said Alcidion Executive Chairman, Mr Ray Blight. “The transaction will significantly expand Alcidion’s capabilities and product offering, as well as enhance our specialist sales and marketing capabilities. Ultimately we are confident that, in operating together, the combined group will be uniquely positioned to offer solutions that support high performance, integrated healthcare”.
Ms Kate Quirke, CEO of Alcidion Group said, “I am excited about the outlook for the enlarged group and believe this transaction represents an excellent opportunity for both companies and our customers. There are significant market opportunities for an integrated Miya and Patientrack product, and our combined system integration and implementation capabilities will represent a differentiated offering in the rapidly evolving health informatics market. I look forward to delivering innovation and efficiency benefits for our customers as well as long-term value creation for our shareholders”.
Subsequent to Alcidion’s initial MKM Health and Patientrack Acquisition announcement in April 2018, Alcidion announced in May 2018 that Patientrack had signed contract extensions for the continued and expanded use of its proprietary Patientrack software in four of its flagship National Health Service (NHS) Trusts in England and Scotland. The contract extensions are for between periods of one to three years and have a combined value of A$890,000. Mr Ray Blight added “these type of contract wins support our strategic belief in the benefits of the Acquisitions we have completed today. They also provide further evidence of the proven ability of the Patientrack customer base to generate sustained revenue over time and provide a platform across which new solution capability can be sold”.
Alcidion also announced in May 2018 that MKM Health had entered into a global reseller agreement with NextGate Solutions Inc., a global leader in healthcare enterprise identification. This will enable MKM Health to extend its scope of system integration and data management services offered to the Australian and New Zealand health care sectors.