BCE Emergis - Acquisition & U.S. listing
BCE Emergis Announces U.S. Healthcare Acquisition of United Payors & United Providers
MONTREAL, Quebec--(BUSINESS WIRE)--Feb. 6, 2000--BCE Emergis (TSE: IFM) announced today that it has entered into a definitive agreement to acquire
United Payors & United Providers, Inc. (UP&UP) (NASDAQ: UPUP) of Rockville, Maryland, by way of merger between a wholly-owned subsidiary and
UP&UP. UP&UP provides claims processing between insurance companies and health care providers, designed to produce cost savings and offer benefits for
insurance companies while increasing liquidity and improving efficiency in claims submissions for providers. The UP&UP national health care network supports over
US$3 billion of medical claims volume through the use of its proprietary technology and focused client service approach. BCE Emergis, with its leading-edge
electronic commerce solutions will extend its expertise in Internet commerce to the UP&UP network. UP&UP has direct business relations with over 2,900
hospitals, 153,000 physicians, 200 insurance companies, and 14,500 ancillary medical facilities throughout all 50 states.
"The U.S. healthcare market, with its myriad costs, players and infrastructures, is perfectly matched to the benefits that the Internet offers," said W. Brian Edwards,
President & CEO, BCE Emergis. "With our experience in transaction processing in healthcare in Canada, we have used the Internet to streamline costs, improve
communications and increase efficiency. With UP&UP, we see the distinct opportunity to leverage our expertise in Internet commerce for the U.S. healthcare
industry by teaming with the business partners of UP&UP, and realizing the advantages of the Internet."
The contemplated transaction is for a price of US$27 per share, or an aggregate amount of approximately US$580 million, subject to certain adjustments, for 100%
of UP&UP. The price is to be paid in cash at closing. The transaction is subject to regulatory and other approvals, UP&UP shareholder approval, and is anticipated
to close in the second quarter of 2000. Management and other major shareholders have agreed to vote their shares in favor of the transaction. UP&UP offers a
transactional business and recurring revenue model and has generated revenues in the aggregate for the nine months ended September 30, 1999 of US$78.9 million.
Morgan Stanley Dean Witter has acted as advisor to BCE Emergis on this transaction and given a fairness opinion to the Company on this matter.
"This is an excellent opportunity to leverage the business relationships and move the UP&UP business to the Internet", said Thomas L. Blair, Founder and Chairman
of United Payors and United Providers. "UP&UP does not market to consumers, and does not determine the benefit coverages for individuals. Rather, through
proprietary technology and customized interfaces with its clients, UP&UP reduces the administrative burden of payors and generates medical cost savings primarily
through volume discounts with providers and via claims repricing technology. BCE Emergis will contribute its e-commerce and Internet expertise and solutions to the
valued relationships with the insurance companies and to the business processes, and bring the business to a network-centric Internet model."
In order to facilitate the transaction, BCE Inc. has committed CDN$800 million consisting of CDN$650 million of BCE Emergis common equity, and of a stand-by
credit facility CDN$150 million represented by convertible notes. BCE Emergis will also enter the U.S. public market, via a marketed offering to raise funds in lieu of
using the line of credit and to provide additional funds for general corporate purposes including future growth and acquisitions.
Brian Edwards continued, "We had said that we would be looking to extend our expertise into the U.S. in a strategic and focused manner and we are extremely
pleased with this acquisition in that regard. UP&UP will add significant U.S. revenue and clients to BCE Emergis' healthcare business, and strong business
relationships with payors and providers in the U.S. More importantly, we will now have an extremely strong and experienced U.S. management team, including
Thomas Blair, the Founder and Chairman of UP&UP and Edward Civera, President, both of whom have been critical to the success and growth of UP&UP. Both
these leaders will continue on with the BCE Emergis healthcare business in the U.S. and continue to manage the business and its employees."
BCE Emergis has been a leader in the processing and adjudication of healthcare transactions:
- It has established strong claims initiatives with leading Canadian insurance payors. By connecting to providers in the drug and dental field and lately vision
care, physiotherapy and chiropractic, BCE Emergis has emerged as the leading claim transaction processor in Canada;
- It has extended this claims expertise to include Workers' Compensation claims and claims evolving from Property and Casualty insurers;
- It has offered many value-added services to their business partners including drug utilization review, trial prescription programs, drug formulary alternatives,
provider "next day payment", and others;
- It has developed an Internet solution for drug reporting as well as the processing of vision care claims; and
- It has established a compliance program with major pharmaceutical manufacturers.
The results are leadership in healthcare transaction processing. Currently, BCE Emergis:
- provides services to 10 of the largest group insurance carriers in Canada, reaching over 20,000 group policyholders covering in excess of 6,000,000
Canadians;
- connects in excess of 2,000 employers to Quebec CSST (WCB) as well as 50 health consultants representing tens of thousands of employers;
- has processed over 5,900,000 drug utilization transactions;
- has processed in excess of 80,000,000 drug claims including RAMQ (Health Insurance Board) claims; and
- has processed over 6,000,000 dental claims.
BCE Emergis delivers network-centric Internet commerce business solutions that improve customer processes through the exchange of secure transactions.
Combining Internet commerce services, network infrastructure, security services, and payment solutions through industry vertical applications, BCE Emergis offers a
full suite of core technologies that are the essential building blocks for electronic commerce. BCE Emergis, is among the top electronic commerce providers in North
America and is listed on the TSE 100 Composite Index. For more information, please refer to www.emergis.com.
This news release contains certain forward-looking statements that reflect the current views and/or expectations of BCE Emergis with respect to its performance,
business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly.
Contact:
BCE Emergis
Anne Belliveau, 514/868-2232
abelliveau@emergis.c |
