British healthcare software development firm iSoft Group reported that it would switch its recommendation to a revised takeover bid by Australia's IBA Health from an offer it previously recommended by Germany's CompuGroup. The Oxfordshire, U.K.-based iSoft has products in use by more than 8,000 healthcare organizations in 27 countries.
IBA sweetened its earlier offer of £140 million ($282 million, U.S.) all-share offer from earlier this year with a revised bid of £166 million ($334 million). Late last month, iSoft had recommended the acceptance of a £160 million ($322 million) all-cash offer from CompuGroup.
As part of its new offering, IBA said it has reached an agreement to acquire 24 percent of iSoft’s shares. IBA, which has a turnover of approximately $48 million, is reported to have strengthened its offer for iSoft after a deal with Allco Equity Partners, an Australian private equity group, to provide up to $246 million to finance the deal.
IBA said the combined group would be better able to complete the development of iSoft's next generation of Lorenzo software, which would then form the enlarged firm's flagship product.
According to Gary Cohen, IBA chairman, the merger of the two healthcare IT companies will create one of the largest providers of health IT solutions in the regions from Europe through to Australasia.