| NEW YORK
NEW YORK Jan 6 Passport Health Communications
Inc, a healthcare software company partly controlled by private
equity firm Spectrum Equity, is close to announcing a deal to
buy Data Systems Group, according to three people close to the
Although financial details of the transaction could not be
obtained, a deal with privately held Data Systems Group, which
develops software products that process medical claims, will
give Passport access to more than 200 hospitals and 85 physician
sites in 20 states.
A deal could come as soon as Monday, the people said,
requesting anonymity as the talks are private. Spokesmen for
Spectrum and Passport declined to comment. Data Systems Group
officials were not available for comment.
Data Systems Group, which was formed in 1971, will also
bring extensive institutional knowledge of California Medicaid
and Blue Shield Medicare in that state to Passport's existing
businesses, the person said.
In 2008, Spectrum and a group of investors including Great
Hill Partners and Goldman Sachs Specialty Lending Group,
provided $232 million in equity capital to Passport, giving the
new investors a controlling stake in the Franklin,
Tennessee-based software service company.
Passport, which competes with larger healthcare technology
rivals McKesson and Cerner Corp, has since announced
two acquisitions and appointed former McKesson Corp
executive Scott MacKenzie as its chief executive officer.
Passport's annual revenue is in excess of $100 million a
year while the company has seen "strong double digit organic
growth" and "strong cash flow margins", one of the people said.
Its products are delivered to more than 2,300 U.S. hospitals and
over 8,600 other healthcare facilities in 50 states.