Speculation over the future ownership of NHS software company iSoft took another twist today as it emerged that an Australian software firm was in talks over a potential offer.
IBA Health confirmed its discussions with iSoft and said it was seeking backing from financial institutions for the move.
ISoft’s shares gained 2%, recovering from fears on Wednesday over failed talks between another potential buyer, US drugs distribution firm McKeeson, and Computer Science Corporation (CSC), which subcontracts NHS work to iSoft.
IBA Health is Australia’s biggest listed health software firm - dealing with electronic patient records and integrated software management systems. It made pre-tax profits of 15.2 million Australian dollars (#6.1m) on sales of 59.2 million dollars (#23.8m) in the year to June 2006 and has a market capitalisation of 560 million dollars (#240m).
It said institutional backing would help refinance its debt facilities and provide enough working capital for the enlarged group.
ISoft, which is headquartered in Banbury, Oxfordshire, was plunged into crisis in 2006 after delays to the NHS contract to provide a centralised database of medical records, coupled with a series of profits warnings and the discovery of accounting irregularities.
In August, the company announced losses of #343.8 million after writing down the value of a major acquisition it made in 2004.
But shares have been on the road to recovery since October, when iSoft announced that the firm had been approached by trade buyers over a potential sale or alliance with the business. US private equity firm General Atlantic Healthcare was also shortlisted for the company with McKesson.
CSC will play a key role in determining a takeover as it will need to be satisfied with the suitability of any future partner on the NHS work.
