MedAssets, Alpharetta, Ga., has made good on longtime speculation that it would be the first group purchasing organization and revenue-cycle management company to become publicly traded.
The for-profit GPO has filed a preliminary prospectus with the Securities and Exchange Commission indicating it intends to issue an initial public offering of 21.6 million shares of common stock, expected to raise a maximum of $230 million in capital. A date for the IPOs commencement is contingent upon completion of the SEC Registration Statement, according to the prospectus.
Though long speculated, the announcement has generated some surprise in the group-purchasing industry, which was established for the purpose of saving hospitals money on the purchase of supplies and services. Over the past two decades, the industry has split between not-for-profit and for-profit versions of GPOs, with services growing to include spending, revenue, clinical and construction-cost analytics, as well as other services focused on improving hospitals financial bottom lines.
MedAssets posted net revenue of $146.2 million and net income of $8.6 million in 2006, according to information filed with the SEC. Morgan Stanley and Lehman Bros. will serve as co-lead banks on the IPO offering, with Deutsche Bank Securities; Goldman, Sachs; and Wachovia Securities underwriting the deal. -- by Shawn Rhea