February 4, 2013 / 3:50 PM / in 5 years

Premier appoints BofA, JPM to lead initial public offering

NEW YORK, Feb 4 (IFR) - The Premier healthcare alliance, the nation’s largest and most comprehensive healthcare database, is headed for an IPO.

Bank of America Merrill Lynch and JP Morgan have been mandated as joint bookrunners and are targeting a $5bn valuation for the healthcare industry data aggregator, according to a source close to the situation.

Representatives from BofA Merrill Lynch and JP Morgan declined comment. Premier neither confirmed nor denied that it was contemplating an IPO.

“We continually pursue strategies that will enable us to achieve our goal. We will communicate openly if and when our owners decide to make any changes to our business model,” said Alven Weil, director of PR and communications at Premier.

A consortium of healthcare providers formed Premier as a way to lower operating and administrative costs through sharing information. The company’s owners are some 200 hospitals and health-care systems, which collectively operate 2,700 hospitals.

The business model is quite similar to Verisk Analytics , a provider of data and analytics to the insurance industry, which raised $1.9bn in its October 2009 debut.

In that offering, selling shareholders comprised more than 100 property and casualty insurers that populated Verisk’s database.

The selling shareholders initially were asked to sell minimum parts of their holdings in the IPO. As Verisk became a more seasoned public company, they were allowed to sell more stock.

It is likely that Premier will pursue a similar tack if it opts to price an IPO.

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