Cerner To Buy Siemens Health IT Business For $1.3 Billion

Cerner CERN -1.45%, the provider of electronic health records run by billionaire Neal Patterson, is purchasing the health care information technology business of German industrial conglomerate Siemens for $1.3 billion.

The deal, which values the Siemens business at slightly more than one
times sales, will increase Cerner’s annual revenue from about $3
billion last year to more than $4.5 billion of annual revenue this year.
The combined company will have 20,000 associates in more than 30
countries, and 18,000 facilities that will be clients.

“We think scale is important,” says Patterson, who founded Cerner in
1979 at his kitchen table. “We were the largest IT company, but this
gets us a bigger, better business platform. We’ll have a combined $650
million [in research and development] spend and we think the future of
healthcare computing is driven around the ability to innovate. This kind
of preserves our ability to spend heavily in innovation and IT
certainly for the rest of this decade.”

The scale and financial heft will help Cerner continue to compete
with existing rivals like Epic Systems, which is becoming a dominant
force in the health information technology space, AthenaHealth, and
AllScripts, as well as new businesses like NantHealth and Flatiron
Health that are aiming to capture some of the very areas of analyzing
big data sets where Patterson sees growth for the industry.

1 Comment
  • Dave Ginn
    Posted at 02:07h, 13 August Reply

    As the merger of Siemens and Cerner unfolds, KSB can rest easy and stay the course in our eSOAR efforts. I believe you'll see a few logo changes and maybe some new account reps, but eSOAR won't change for many years. We've seen this type of thing before and we'll be just fine. Remember when GE purchased MUSE, Philips acquired Witt and McKesson bought Practice Partner? Let's watch this un

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