NetDimensions (NETD) Acquires eHealthcareIT
Edison | Mar 04, 2013 08:25AM ET
NetDimensions (NETD) has purchased eHealthcareIT, a provider of e-learning and compliance solutions to the US healthcare market, for c $3.5m. NETD knows eHealthcareIT well, as it has been a reseller of NetDimensions Talent Suite for six years, bundling the software with content to customers primarily in the south-eastern US. The acquisition will enable NETD to accelerate its growth in the healthcare vertical, which will represent c 20% of group revenues on a proforma basis. The deal reflects the group’s stated strategy of growing its businesses in highly regulated areas that have a stringent requirement for employee training compliance. We will review our forecasts with the final results in April.
NETD bought eHealthcareIT from its proprietor, Ken Wright, for c $3.5m. Mr Wright will stay on and head up the enlarged group’s healthcare division. The consideration is $1.25m in cash on completion, $0.75m in four equal instalments over one year, $0.5m in earn-out instalments over a year and $1m in 1.5 million new shares at 66.67c each. NETD had $6.8m of cash by the end of December and no debt. eHealthcareIT, based in Atlanta, Georgia, recorded $2.1m in revenues in FY11 with a small profit and saw further growth in FY12. Two thirds of its revenues are recurring in nature, with the balance mainly in professional services. eHealthcareIT currently has 10 employees; NETD plans to expand the unit by recruiting additional quota-carrying salespeople.
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