Neoforma, San Jose, Calif., said it would acquire the health and life sciences businesses of I-many, Edison, N.J., which provides software and services to manage purchasing contracts, for $20 million in cash and stock. The agreement includes an additional $5 million in stock for meeting certain revenue targets after the purchase. Neoforma said it would hire most of the about 150 employees at I-many's health and life sciences businesses. Based on Neoforma's closing price Friday, I-many would own about 4% of Neoforma and about 6% if the maximum $25 million purchase price were reached. Neoforma, the e-commerce partner of Novation, the healthcare industry's largest group purchasing organization, said the acquisition would accelerate its growth and diversify its customer base by offering such services as rebate and compliance tracking to hospitals, suppliers and GPOs. In 2002 and the first quarter of 2003, I-many's health and life sciences businesses generated $37.5 million and $6.5 million in revenue, respectively. The deal, which is subject to shareholder and regulatory approval, is expected to close early in the fourth quarter. -- by Cinda Becker
Neoforma to acquire contract management firm
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