UnitedHealth Group Inc. is buying Change Healthcare, a health technology firm based in Nashville, in a $13 billion deal that is among the largest by the Minnetonka-based company.
UnitedHealth said Wednesday it will fold the company into Optum, its health information and technology business. It is the second-largest acquisition in company history, further widening UnitedHealth's empire beyond its legacy health care plans.
While UnitedHealth is best known as the nation's largest health insurer, it is seeing significant growth in its medical services that fall under Optum — which is expected to account for about 50% of UnitedHealth's overall earnings in 2021.
Change, with about $3 billion in annual revenue, will deepen UnitedHealth's already sizable presence in health services, with products ranging from revenue management to customer experience platforms to medical imaging data.
Change will be combined with OptumInsight, which offers software, data analytics and related services to health care providers. It is the smallest division in Optum and had about $11 billion in revenue last year.
Neil de Crescenzo, Change's chief executive, will assume the top position of the newly expanded OptumInsight.
UnitedHealth will pay $25.75 a share for Change, about a 40% premium to Change's closing share price on Tuesday and a price that puts Change's value at nearly $8 billion. UnitedHealth will also assume about $5 billion of debt owed by Change.
On a cash basis, the only larger deal by UnitedHealth was its $13.2 billion purchase of Catamaran Corp., which boosted its presence in the business of prescription-drug benefit management.