MTBC signs agreement to acquire Orion’s assets, could increase revenues by 50%

Somerset-based MTBC, a provider of cloud-based health care IT and revenue cycle management solutions, announced it has entered into a purchase agreement to acquire all of the revenue cycle, practice management and group purchasing organization assets of Orion Healthcorp Inc. and 13 of its affiliates.

The purchase price is expected to be between $10 million and $12 million.

Upon the deal closing, MTBC said it expects to increase its revenue by approximately 50 percent.

“The Orion acquisition has the potential to be transformative,” said Stephen Snyder, MTBC CEO. “Our last major acquisition enabled us to achieve record revenue growth and earnings during 2017 as we helped our acquired customers increase practice collections and leverage our industry leading platform. With Orion, we see an even greater opportunity to add value to Orion’s customers, its employees, and our shareholders, as we have done with prior transactions.”

“At closing, the Orion transaction would likely expand our service offerings to include long-term practice management services, niche hospital offerings, and a pharmaceutical group purchasing organization that provides discounts to its physician customers,” Snyder said. “These new offerings and customer relationships present compelling opportunities for cross-selling our solutions and driving additional growth.”

Orion is a revenue cycle management provider for health companies. It has offices in 10 states and employs more than 300.

“The opportunity presented by Orion is tailor-made for MTBC,” said Bill Korn, MTBC chief financial officer. “Our highly scalable proprietary technology and processes, experienced team, and strong balance sheet have made us the leading consolidator in our space. We are uniquely equipped to succeed with the Orion transaction, having successfully integrated MediGain’s business, which faced a similar situation before we purchased their assets 20 months ago. That transaction allowed MTBC to grow revenues by 30 percent in 2017 and achieve record profitability, and after successful integration of Orion, we expect to be able to grow our annualized revenues by at least another 50 percent, to achieve a scale which will allow us to further expand our profit margins.”

Under the agreement, MTBC would acquire most of Orion’s assets including customer contracts, accounts receivable, equipment and goodwill.

Houlihan Lokey is advising the sellers in this transaction.