Proxicom Inc., a vendor of software development and systems integration services, has announced plans to purchase Daou Systems Inc., a healthcare software developer and consulting firm. The acquisition is totaled at $21.6 million.
Daou serves healthcare provider and payer organizations. The company's services include application development and implementation, wireless/wired network implementation, and mobile computing solutions and web portal development.
Daou has recently seen a significant decline in revenue. In 2004, the company lost $4.4 million as revenue fell 36 percent to $27.1 million. More recently, Daou's first quarter 2005 revenue fell by 29 percent. In a quarterly report the company claimed that "slow transformation of our services to meet the current demands of our customers," was one main cause for the revenue decline.
The acquisition is planned for an early fourth quarter closing. Under the agreement terms, Daou will continue to operate under its name through under the umbrella of Proxicom.