Frazier Healthcare Partners Acquires MedData for $300 Million to Expand Healthcare and Software Development Capabilities

On October 17, 2019, VCBeat (WeChat ID: vcbeat) learned via Business Wire that private equity firm Frazier Healthcare Partners (“Frazier”) announced the acquisition of MedData, a healthcare and software development company under MEDNAX, for $300 million. The transaction is expected to close by the end of 2019.

In November 2018, MEDNAX announced the sale of MedData to focus on its core businesses, such as physician services. Reportedly, MEDNAX will use the net proceeds from this transaction to repay debt, conduct share buybacks, and pursue strategic acquisitions. Additionally, MEDNAX has entered into a long-term agreement with MedData, under which it will become one of MedData’s largest customers following the completion of the transaction.

MedData, established in 1980 and headquartered in Ohio, USA, is a healthcare and software development company. The company primarily provides technical support and management services to hospitals, health systems, and healthcare enterprises. Since its inception, MedData has been delivering innovative solutions to the medical community, serving numerous healthcare professionals and hundreds of millions of patients. Currently, the company maintains offices in more than 20 regions across the United States, providing services to over 10,000 physicians through more than 3,000 institutions.

MEDNAX, founded in 1979 and headquartered in Florida, USA, is a nationwide healthcare organization. Comprising leading physician service providers in the United States, the company serves as a national partner for health solutions. To date, MEDNAX provides management and consulting services to healthcare institutions and medical professionals across all 50 U.S. states through its affiliates, including Pediatrix Medical Group.

MEDNAX’s physicians and advanced practice providers are reshaping the healthcare delivery model by enhancing patient outcomes through continuous quality improvement initiatives, clinical research, and telemedicine, while delivering high-quality, cost-effective care. The company went public on the New York Stock Exchange in January 2003, trading under the ticker symbol MD.

Frazier, founded in 1991 and headquartered in Seattle, USA, is a venture capital and private equity firm. The firm primarily focuses on acquisitions in the lower-middle market and provides financial support to healthcare companies. Frazier maintains offices in Washington State and California, with a broad investment portfolio spanning the United States, Canada, and Europe. To date, the company has invested in more than 170 companies and manages over $4.2 billion in assets.

Nader Naini, Managing Partner at Frazier, stated, “We are delighted to partner with MedData to continue delivering best-in-class capital management and advisory services to our broad client base. We aim to provide enterprises with additional resources to help accelerate product R&D and manufacturing, reduce costs, and optimize operations.”

Stephen D. Farber, Executive Vice President and Chief Financial Officer of MEDNAX, stated, “This acquisition represents a significant step in MEDNAX’s transformation. The sale of MedData will better position MEDNAX financially and strategically to focus on its core business, while significantly reducing the company’s leverage and future capital expenditures.”

(Compiled by Xu Xiaoxue)