Evolent Health to Acquire Valence Health for $145 Million

Thursday, July 14, 2016

Evolent Health, Inc. and Valence Health, Inc. announced that they have entered into a definitive agreement for Evolent to acquire the majority of Valence Health's business for approximately $145 million.

The combination of Evolent and Valence Health brings together two innovative companies that serve health care providers in the transition to value-based care. Evolent was founded in 2011 to support providers in moving to a population health model of care delivery and to successfully manage performance-based payment arrangements. Valence Health, based in Chicago, IL, was founded in 1996 and provides value-based administration, population health and advisory services. In its 20 year history, Valence Health has developed particular expertise in the Medicaid and pediatric markets, and today supports approximately 600,000 lives across 10 long-term operating partners.

"By adding Valence Health's services to Evolent, we expect to strengthen our operational capabilities and expertise, expanding our ability to support provider organizations in delivering higher quality, lower cost care," said Evolent CEO Frank Williams. "Strategically, we have tightly aligned visions of improving health care through innovative technology and services that help providers succeed as the industry continues its adoption of value-based payment models. Practically, we expect the addition of Valence Health's talented team and their experience in value-based administration will advance our ability to drive results for a broader set of clients, providers and patients. We are looking forward to welcoming Valence Health employees and clients to the Evolent team."

Valence Health CEO R. Andrew Eckert expressed his excitement, saying, "Our two organizations are culturally and operationally aligned to deliver robust value-based administration and services to health care providers. Combining our team's 20 years of clinical and strategic experience with Evolent's proven innovations in value-based care will allow us to better serve our clients with best-in-class technology, clinical models and administrative service capabilities."

Strategic Rationale

Together, the organizations will be able to offer comprehensive services and technology across a variety of populations and will serve more than 1.8 million lives across 23 long-term operating partners at closing, comprised of provider-sponsored health plans, accountable care organizations and full-risk entities.

"The addition of the Valence Health business will provide increased scale and client diversification, and we expect it to accelerate our target timeline to Adjusted EBITDA break-even in 2017 by one to two quarters," said Evolent CEO Frank Williams. "We believe this transaction will strengthen our business strategically and financially and position it for continued growth well into the future."

 

Source : ir.evolenthealth.com