Information systems vendor HBO & Co. last week completed the acquisition of First Data Corp.'s health systems group and pulled the plug on some of the former competitor's leading products in development.
The purchase price of $200 million reflects the value of 4 million shares of stock issued to First Data Corp. at an average trading price of $50 in the days leading up to the transaction's closing.
Atlanta-based HBO & Co. will operate the health systems group as a business unit headed by Charles W. Miller, former senior vice president for operations at the Charlotte, N.C.-based company.
The acquisition plans were first announced in mid-May (May 22, p. 30). Since then, HBO & Co. has analyzed First Data's set of software products to determine what to keep developing and what to cut loose.
In a letter to chief information officers, Miller and his new boss, HBO & Co. Vice President James A. Gilbert, committed the company to improving the Saint, Precision Alternative and Host product lines.
But the aggressively marketed First Dimension and First Empower clinical systems won't be continued. First Data said it had nine First Empower customers going through installation and another 10 signed and waiting, as well as a dozen contracts signed for the First Dimension system still in development.
The CIO letter said the products were too similar to components of HBO & Co's Pathways 2000 series. No decision has been made on a physician practice management product called First Inform.
A medical-records scanning and storage system called First Perspective will continue to be marketed and developed. That system is installed in eight hospitals, with 20 total contracts signed, according to First Data's records.