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Private equity firm Bain Capital is nearing a deal to buy US healthcare software company HealthEdge, in a transaction that would value the business at about $2.6bn including debt, according to people familiar with the matter.
If the deal gets across the line, it will be the latest in a string of successful sales of private equity-backed software companies announced in recent weeks.
As part of the deal, Blackstone will exit its controlling stake in HealthEdge, which it has owned since 2020. Small minority shareholders, such as Philippe Laffont’s Coatue Management will also offload their stakes, the people with knowledge of the situation said.
The software sector, which is more insulated from the impact of President Donald Trump’s aggressive tariffs policy than some other industries, has proven to be a relative bright spot for dealmaking as wider mergers and acquisitions activity has slowed.
Blackstone and Bain declined to comment. HealthEdge and Coatue did not immediately respond to requests for comment.
Bain’s acquisition of HealthEdge is likely to be announced in the coming days, provided it does not face any last-minute issues or another buyer emerges.
HealthEdge sells novel software for health insurers to modernise their systems in ways that ease designing healthcare plans and deciding about claims.
The company generated $86mn in earnings before interest, tax, depreciation and amortisation last year, as well as $400mn in revenues, according to one person briefed on the planned transaction.
Bain Capital oversees $185bn of assets under management, with investments across business services, healthcare, technology and industrials. It owns healthcare payer behemoth Zelis and this year made a take-private bid for healthcare group Surgery Partners.
Blackstone first put HealthEdge up for sale in 2022. However, the private equity group struggled to find a buyer willing to pay enough to secure it a return on the $700mn it had paid in 2020 when investors were piling money into healthcare companies at the start of the Covid-19 pandemic.
Blackstone bankrolled bolt-on acquisitions at HealthEdge including the takeovers of Wellframe and Altruista Health. It will roughly double its money on the sale, a person briefed on the matter said.
M&A activity has dried up in recent weeks as financial market turbulence, concerns that interest rates may fall at a slower-than-expected pace due to Trump’s trade policy, and the threat of tariffs to companies’ business models has put most deal talks on pause.
Yet several large software transactions have got over the line: Clearlake Capital bought a majority stake in electronic health records company Modernizing Medicine, valuing the business at $5.3bn, and Siemens AG bought the life-sciences software company Dotmatics for $5.1bn.
