The QuadraMed Corp., a Reston, Va.-based provider of revenue cycle management technology and services, has entered into an agreement to be acquired by Francisco Partners, a technology-focused private equity firm.
QuadraMed executives announced the pending $126 million cash deal Tuesday.
Under terms of the agreement, San Francisco-based Francisco Partners will acquire all of the outstanding shares of QuadraMed's common stock for $8.50 per share in cash and all outstanding shares of QuadraMed's Series A cumulative mandatory convertible preferred stock for $13.7097 per share in cash.
The proposed purchase price per share of common stock represents a premium of approximately 32.6 percent to the closing share price of QuadraMed's common stock on Dec. 7, 2009, the last trading day prior to the public announcement of the transaction, a premium of approximately 33.3 percent to the 30-day trailing average closing price of QuadraMed's common stock, and a premium of approximately 7.1 percent to the 52-week-high closing price of QuadraMed's common stock.
Following unanimous recommendation from a special committee of independent directors, QuadraMed's board of directors approved the agreement and has recommended that stockholders vote to approve the deal. Piper Jaffray & Co. has acted as exclusive financial adviser and delivered a fairness opinion to the special committee and the board of directors.
"After a thorough and careful review of the strategic alternatives available to us, QuadraMed's special committee and board of directors have concluded that this transaction represents the best option to maximize value for our shareholders," said James E. Peebles, chairman of QuadraMed's board. "The board believes that this transaction is in the best interest of our shareholders and is also beneficial to our customers and partners."
QuadraMed's directors and executive officers and affiliates, who control approximately 8.4 percent in the aggregate of the outstanding common stock, have agreed to vote their shares in favor of the transaction, which is subject to customary closing conditions, including the approval of QuadraMed's common stockholders and regulatory approval.
There is no financing condition to the transaction, but Wells Fargo Foothill, part of Wells Fargo & Company, and Silicon Valley Bank have committed to provide debt financing for the transaction. The company anticipates a stockholder meeting in the first quarter of 2010, with closing to follow shortly thereafter.
QuadraMed plans to maintain its Reston headquarters and operations at its various offices throughout the United States.