Activist investor takes aim at athenahealth

Paul Singer’s Elliott Associates bought a 10 percent stake in the EHR vendor, says there are many ways the company can improve shareholder value.
By Bernie Monegain
02:12 PM
athenahealth EHR vendor

Investment firm Elliott Associates has bought 9.2 percent of athenahealth stock, according to an SEC filing submitted Tuesday, and speculation has already started about what that might mean for the health IT company’s future. 

For starters, athenahealth’s stock jumped 8 percent Thursday morning on the news.  

According to the SEC filing, Elliott Associates described athenahealth stock as an attractive investment opportunity because it is currently undervalued. 

[Also: Athenahealth stock struggling after poor earnings; Bush partly blames Trump]

"There are numerous operational and strategic opportunities to maximize shareholder value and the holder will be seeking to engage in a dialogue with the company's board regarding these matters,” Elliott Associates stated. 

TheStreet reported this morning that, for Singer, “strategic opportunities usually mean find a buyer and sell the business.” 

Elliott Advisors just last week, for instance, pressed Dutch paint maker Akzo Nobel to enter takeover talks with US rival PPG Industries, and soon after began legal proceedings to try to oust the company’s chairman, according to reports.

“We are aware of Elliot’s filing and look forward to talking with them to hear their views about the company and discuss the actions we are taking to drive enhanced growth and value creation for all athenahealth shareholders,” athenahealth director of PR Holly Spring said. “We have great confidence in the company and where we are headed.”

In an investor call earlier this month, athenahealth co-founder and CEO Jonathan Bush said the uncertainty around healthcare legislation had been bad for business, and he blamed that on President Trump. 

Founded in 1977, Elliott Associates today manages more than $32 billion in capital for both institutional and individual investors. The firm describes itself as a multi-strategy firm, active in debt, equities, commodities, currencies and various other asset classes across a range of industries, especially in technology.

An Elliott Associates spokesman declined to comment beyond what it had reported in the SEC filing.

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