API Healthcare, Kronos Halt Merger Plans
API Healthcare and Kronos Inc. have terminated a previously announced merger after the Justice Department raised concerns that the deal would reduce competition and raise prices for healthcare-specific workforce management technology.
DOJ officials applauded the news and noted that if the purchase of API had been completed, Kronus would have acquired its biggest competitor for healthcare-specific time and attendance software and related technology, creating a single company controlling 70% of the time and attendance healthcare market.
"We welcome the decision to abandon this deal, which will preserve competition in the market for time and attendance technology in the healthcare industry," Christine Varney, Assistant Attorney General in charge of the Justice Department's Antitrust Division, said in a media release. "The abandonment of this transaction means that consumers will continue to receive the same benefits of competition, including greater innovation and lower prices, they're now receiving."
API, based in Hartford, WI, and owned by investment firm Francisco Partners II L.P., operates in more than 1,000 healthcare sites and had 2010 revenues of $52 million. Kronos, based in Chelmsford, MA, is owned by investment firm Hellman & Friedman Capital Partners VI L.P. and provides workforce management software to tens of thousands of organizations in 60 countries in the healthcare industry and in other industries, according to portfolios issued by both companies.