Bangalore, India and Somerset, New Jersey, USA - February 11, 2016:
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO), a leading global information technology, consulting and business process services company today announced that it has signed a definitive agreement to acquire HealthPlan Services from Water Street Healthcare Partners, a strategic investor focused exclusively on the health care industry. Since partnering with Water Street in 2008, HealthPlan has grown to become the leading independent technology and Business Process as a Service (BPaaS) provider in the U.S. Health Insurance market. As part of the agreement, Wipro will acquire 100% of HealthPlan Services' shares for a purchase consideration of USD 460 million.
Headquartered in Tampa, Florida, HealthPlan Services employs over 2,000 associates. HealthPlan Services offers market-leading technology platforms and a fully integrated Business Process as a Service (BPaaS) solution to Health Insurance companies (Payers) in the individual, group and ancillary markets. HealthPlan Services BPaaS solutions are ideal for payers who want to operate in the private and public exchanges and the off-exchange individual market in the U.S.
HealthPlan Services provides U.S. payers with a diversified portfolio of health insurance products delivered through its proprietary technology platform. In the highly competitive Exchange market, payers rely on HealthPlan Services' innovative and robust offering to acquire, service and retain members. Payers also leverage the analytical and predictive engines of HealthPlan Services to better serve their members. Today, HealthPlan Services connects its payer clients to over 40 public exchanges and over 150 private exchanges in the U.S. HealthPlan Services has powered many of these payers to achieve desired membership growth, while keeping their administrative costs predictable.
The Patient Protection and Affordable Care Act has dramatically altered the health insurance landscape in the U.S. The post-reform individual market is growing at a fast pace and is expected to continue to grow in coming years. By partnering with HealthPlan Services, Wipro gains the competitive, first-mover advantage in the high growth public and private exchange space for individual, group and ancillary markets. This partnership also strengthens Wipro's payer portfolio, with access to HealthPlan Services' payer clientele.
This transaction is closely aligned with Wipro's key levers for growth, which are to dominate the services market through industry utilities that multiple customers can use. This acquisition adds another platform-led Business Process as a Service (BPaaS) offerings, delivered on cloud to Wipro's services portfolio. Wipro's clients currently include over 100 U.S. payers, leading healthcare providers, and public health agencies.
"The partnership with HealthPlan Services positions Wipro to participate in the shift of the US health insurance industry towards a consumer-centric business model. HealthPlan Services strengthens Wipro's position in the health insurance exchange market while offering synergies with Wipro's presence in the Managed Medicare and Commercial Group Insurance markets. The addition of HealthPlan Services' capabilities complements Wipro's strengths in claims processing and back office services. This is a strategic move for us, as it advances Wipro's vision of leveraging unique insights into customer buying behavior and applying this across the healthcare value chain. This will help us lower the cost of healthcare and transform the quality of the member experience," said Jeffrey Heenan Jalil, Senior Vice President & Head-Healthcare Life Sciences and Services, Wipro Limited.
"We welcome the HealthPlan Services team to the Wipro family. Over the past eighteen months we have transformed our BPS business into a platform-led BPaaS business with a strong focus on the healthcare services market. This transaction will help us become the leader in administrative service in the U.S. health insurance industry. The partnership with HealthPlan Services also reinforces our commitment to the US market by creating jobs and value within the US economy," said Nagendra Bandaru, Senior Vice President and Head - Business Process Services, Wipro Limited.
"We are excited about what Wipro and HealthPlan Services can accomplish together for our customers and employees," said Jeff Bak, CEO and President of HealthPlan Services. "The combination creates the first true end-to-end solution in the individual under 65 commercial market and the governmental over 65 and Medicaid markets. Together, Wipro and HealthPlan Services will give payers the power to accelerate growth strategies while providing both Business Platform as a Service (BPaaS) and competitive administrative service solutions. We are delighted that Wipro believes in our talented people, strategic vision, corporate culture and business fit to help insurers succeed in a consumer-centric world."
This transaction is subject to customary closing conditions and regulatory approvals and is likely to be completed in next 60 to 90 days.
Investor Conference Call
We will hold a conference call today at 6.00 PM Indian Standard Time (7:30 A.M. US Eastern Time) to discuss the acquisition. The audio from the conference call will be available over a bridge as well as online through a web-cast and can be accessed at the following hyperlink Click here
An audio recording of the management discussions and the question and answer session will be available online and will be accessible in the Investor Relations section of our website at www.wipro.com.