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ClearBridge Encourages Athenahealth to Consider Elliott Deal

By Jack O'Brien  
   May 31, 2018

One of Athenahealth's largest shareholders told the health technology servicer to consider a $7 billion bid from Elliott Management Corp.

As Athenahealth Inc. considers a cash offer from Elliott Management Corp. to acquire the company for $160 per share, one of its prominent shareholders, ClearBridge Investments, has blessed the potential $7 billion deal.

In an open letter released Wednesday, ClearBridge leadership told Athenahealth executives to consider "a different mindset" to alter the organization's "downward trajectory." This followed a "frank conversation" between ClearBridge and the Athenahealth board of directors last week.

"In light of the public proposal to take athenahealth private by Elliott Management, ClearBridge Investments strongly encourages the Board of Directors to fully exercise its fiduciary responsibility to represent all of the company's shareholders," the letter read.

ClearBridge's letter follows weeks of dueling letters between Athenahealth and Elliott, a private equity firm seeking to purchase the troubled health technology servicer and turn it private again. In recent years, Athenahealth has dealt with executive turnover and struggled since going public.

Below are important notes regarding the latest developments regarding Aethnahealth:

  • "We acknowledge that the Board began to take measures last summer to scrutinize the business from all angles and improve execution," the letter read. "We further believe it is essential to continue that effort to its fullest logical outcome."  

  • ClearBridge also urged Athenahealth executives to instruct Lazard and Centerview Partners, its financial advisors, to begin a "formal solicitation process including all potential strategic and financial suitors."  

  • Elliott's third letter includes quotes from numerous other shareholders urging Athenahealth executives to consider or embrace the offer to take the company private.

Jack O'Brien is the finance editor at HealthLeaders, a Simplify Compliance brand.


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