Following speculation earlier this month, McKesson announced today it is merging its McKesson Technology Solutions (MTS) business with Nashville, Tenn.-based Change Healthcare to form a brand new healthcare IT company.
“This is a bold, innovative transaction that creates a company with an enhanced ability to help customers address their increasingly complex financial and clinical challenges,” John H. Hammergren, McKesson chairman and CEO, said in a prepared statement. “The new company will establish a more efficient suite of end-to-end payment and claims solutions, as well as clinical capabilities, while unlocking the value of our MTS businesses in a tax-efficient manner. We look forward to partnering with Change Healthcare’s management team and employees to create this new enterprise and to help customers reduce complexity, lower costs and ultimately provide better care.”
“The combination of these two entities comes at a transformational time in U.S. healthcare,” Neil de Crescenzo, Change Healthcare president and CEO, said in the same statement. “Together we will create significant value by bringing together complementary capabilities from both organizations to deliver innovative new solutions for customers, create opportunities for team members at a leading healthcare technology company, and drive advancements that address the three critical areas of cost, quality and outcomes across the healthcare sector.”
Both McKesson and Change Healthcare will govern this new company. McKesson owns approximately 70 percent of the company, while Change Healthcare owns approximately 30 percent. Once the transaction is closed, which is expected in the first half of 2017, McKesson will receive cash proceeds of approximately $1.25 billion, and Change Healthcare is expected to receive approximately $1.75 billion.
Information about this new company, including video messages from Hammergren and de Crescenzo, is available here.