Poll results: Readers say athenahealth should not sell to activist investors

We asked for your thoughts on athenahealth’s next steps now that Jonathan Bush stepped down as CEO, and the resounding majority said athenahealth should not sell to Elliott Management, which put out a $6.5 billion bid in May.
By Bernie Monegain
01:11 PM
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Athenahealth should it sell company or keep it

Credit: athenahealth on Twitter

While the future of athenahealth is still unknown after the departure of CEO and co-founder Jonathan Bush, the overwhelming majority of our readers said the company shouldn’t sell to activist investors.

And while several readers commented that the time was right for a sale, of the 201 responses, 75 percent said “No,” athenahealth shouldn’t sell. Just 25 percent voted “Yes” to the company’s selling. Others suggested holding out for a better offer.

“Elliott Management is not interested in athenahealth’s vision – they are horrendous,” one observer wrote on the Healthcare IT News poll.

“I don't believe a hedge fund company is the best choice to drive the innovation that will be necessary to change healthcare,” wrote another.  “I believe that their focus would be on immediate profits rather that long-term growth.”

Yet another comment suggested the company go private and continue its mission.

Others pointed to the company’s struggles over the past year, highlighting that, while Elliott Management may not be the best choice, the company does need help.

“Athenahealth caused some initial disruption, but they have been trending downward over the past 12 months, potentially reaching the ceiling of their ‘scutwork’ niche,” a reader wrote.

Bush stepped down just two weeks ago following claims of domestic abuse and sexual harassment. His departure also came amid a bid from activist investor Elliott Management for $6.5 billion. Some say the amount -- about $160 per share -- is lower than the company’s worth.

However, it’s far from being a done deal. Athenahealth's executive chairman Jeff Immelt suggested that a sale, merger or remaining independent are all options. Immelt was appointed executive chairman after Bush’s departure and is charged with sorting out the best possible course for the company going forward.

“To ensure athenahealth maximizes shareholder value and is best positioned to realize the full potential of its premier healthcare technology platform, the board has authorized a thorough evaluation of strategic alternatives, including a potential sale or merger or continuing as an independent company under new leadership,” Immelt said in a statement, earlier this month.

On June 6, Bush walked away from the company he co-founded in 1997. He was in the midst of retooling athenahealth when Elliott Management returned with an offer, about one year after they purchased a 9.2 percent stake in the company.

CORRECTION: This story was updated to reflect that athenahealth is a publicly held company.

Twitter: @Bernie_HITN
Email the writer: bernie.monegain@himssmedia.com