DXC will retain the rest of its healthcare practice, to service customers in the healthcare sector, including payers, providers and life sciences firms
Healthcare IT solutions provider DXC Technology has agreed to sell its US state and local health and human services business to Veritas Capital, an investor in government and healthcare technology businesses, for $5bn in cash.
The transaction is expected to be completed before December 2020, subject to the fulfilment of few expected closing conditions, including the receipt of certain third-party consents and regulatory approvals, and is not subject to any financing condition or shareholder approval.
Veritas Capital CEO and managing partner Ramzi Musallam said: “DXC’s U.S. State and Local Health and Human Services business is a leading player in a highly complex market that continues to benefit from technological innovation. The intersection of government, technology and healthcare is a key focus area for Veritas.
“By combining the business’ talented employees with our extensive industry experience, we plan to build on the business’ unwavering commitment to its customers and leadership in mission-critical healthcare technology to drive continued improvement in the quality of healthcare for citizens nationwide. We look forward to welcoming the business and its employees into the Veritas portfolio.”
DXC provides technology-enabled solutions for US health programmes
DXC said that the divestiture decision is the initial outcome of its process to explore the alternatives for three of its non-core assets, which was announced in November 2019.
In addition, the transaction is consistent with the company’s policy of balance sheet maintenance and an investment-grade credit profile, and it intends to use proceeds from the transaction to pay down debt.
Through its US state and local health and human services business, DXC is said to provide technology-enabled, mission-critical solutions for health programs across the US.
In addition, the company is said to deliver complex systems for public sector clients, and facilitate enhanced performance and improved outcomes in the healthcare ecosystem.
With the completion of the transaction, DXC will retain the rest of its healthcare practice, to service customers in the healthcare sector, including payers, providers and life sciences firms.
DXC president and chief executive officer Mike Salvino said: “I’m pleased that we were able to identify such an outstanding home for our U.S. State and Local Health and Human Services business. DXC has built a unique capability that currently serves 42 states and territories with an incredibly experienced and dedicated workforce.
“Throughout this process, we will continue to closely engage with all of our stakeholders to ensure that we meet our commitments and provide a seamless transition for our customers and our people.”