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Allscripts Considering Leveraged Buyout Offers From Blackstone, Carlyle, and More PE Groups


The company is up in midday trading on news of the potential sale.

MINYANVILLE ORIGINAL After announcing late last month that it is comtemplating a sale of the company, Allscripts Healthcare Solutions (NASDAQ:MDRX) has received first-round leveraged buyout bids from private equity groups such as Blackstone Group (NYSE:BX), Carlyle Group (NASDAQ:CG), and Silver Lake Management, reports Bloomberg News.

The electronic health-records provider, which has retained Citigroup (NYSE:C) as its advisor on the sale, now wants second-round offers in the next three to four weeks, sources told Bloomberg.

Allscripts has had a troubled year. After the company fired chairman Phil Pead in April, three directors also left with Pead in protest. Allscripts then faced a proxy battle with major shareholder, hedge fund Healthcor Management, which eventually placed three of its candidates on Allscript's board in June.

Leo Carpio, an analyst at Caris & Co in New York, noted on October 1 that Allscripts may have felt greater pressure to sell after it lost out on a $302 million contract to manage the record systems for New York City public hospitals.

In the past week, a slew of analysts covering Allscripts have revised their targets on shares of the company. ISI Group moved Allscripts to Overweight from Buy and upped their price target to $14.50 from $11.50. Analysts at Cowen moved the company to Outperform from Neutral, while those at Robert W. Baird raised their target from $15.00 to $17.00.

Sterne Agee, who has a Buy rating on Allscripts, also lifted its price target to $15.00 from $13.50, saying in a note, "Our analysis suggests a $15-19 valuation range for MDRX shares should a go-private transaction be consummated by year-end. At the low end, this valuation range is 20% above today's closing price, while the top end implies 50% upside. As such, we have raised our price target to $15 per share from $13.50."

Shares of Allscripts were down 29.62% year-to-date before Monday's open. As of 11:00 a.m. EDT, however, Allscripts' share price has risen 2.33% to $13.64.

Twitter: @sterlingwong
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