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CompuGroup Medical Reports Successful Completion of Acquisition of eMDs in the US

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Summation

  • The new, strengthened CGM US company is intended to benefit from current growth in the health IT market in an accelerated manner and simultaneously make the dynamics of this sector in the US accessible more quickly to all divisions of CompuGroup Medical.

December 22, 2020

CompuGroup Medical SE & Co. KGaA (CGM) is strengthening its international market position and rising to belong to the leading providers of Ambulatory Information Systems in the US, with the acquisition of eMDs, a Texas-based corporation.

CompuGroup Holding USA, Inc., a 100 % subsidiary of CompuGroup Medical SE & Co. KGaA, successfully completed the reverse triangular merger under US law, making this growth opportunity possible. During the course of the closing, all of the company’s shares will be included in CGM’s financial statements as of December 31, 2020.

The main products of eMDs are Ambulatory Information Systems and Revenue Cycle Management.

The acquisition price is around USD 240 million (EUR 203 million). The acquisition price will be financed from cash, current cash flow, and a temporary drawdown of the revolving multi-year loans in the low double-digit million-euro range. In the 2019/2020 fiscal year (ended on March 31, 2020), with more than 60,000 service providers, eMDs generated revenues of around EUR 81 million with an adjusted EBITDA of around EUR 12 million. eMDs currently employs around 1,400 staff.

The new, strengthened CGM US company is intended to benefit from current growth in the health IT market in an accelerated manner and simultaneously make the dynamics of this sector in the US accessible more quickly to all divisions of CompuGroup Medical. For this purpose, investments are particularly planned in the areas of electronic data interchange (EDI) and product development, which are already intended to be implemented in the coming months.

“With eMDs, we are taking our US business to a new dimension. Know-how, products, and target markets excellently complement one another,” said Frank Gotthardt, founder and CEO of CompuGroup Medical SE & Co. KGaA. The Group, with its headquarters in Germany, is one of the world’s leading providers of eHealth solutions. “We are also expanding our sales network with another 100 partners through the acquisition. We are now even better and more broadly positioned to take advantage of the current growth trend in the US market for health IT, for the benefit of patients and health professionals.”

Benedikt Brueckle, Chief Executive Officer, CompuGroup Medical US, said, “I am looking forward to working with Derek Pickell and his team. We have consistently focused our company on growth and scale over the past years. With the acquisitions of eMDs and Laboratory Information System provider Schuyler House—also completed in December—this will allow us to beat market growth and profitability rates in the coming years.”

Derek Pickell, CEO of eMDs, emphasized, “I am so excited and energized by the investment from CompuGroup Medical which will further allow us to enhance our focus on market leadership.  With our common mission, our combined forces are committed to providing solutions that improve the health of our practices, business partners, employees, and most importantly, the health of all patients that interact with our solutions. I am looking forward to continuing the growth story of eMDs together with Benedikt Brueckle and his team as part of CompuGroup Medical. We are focused on achieving high levels of customer and employee satisfaction and retention to grow our business for years to come!”

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Medical Device News Magazine provides breaking medical device / biotechnology news. Our subscribers include medical specialists, device industry executives, investors, and other allied health professionals, as well as patients who are interested in researching various medical devices. We hope you find value in our easy-to-read publication and its overall objectives! Medical Device News Magazine is a division of PTM Healthcare Marketing, Inc. Pauline T. Mayer is the managing editor.

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