M&A Knowledge for the IT Services Business Community.

Common Alignment Prompted Medicus IT, CompuTech City Transaction

Medicus IT and CompuTech City have a great deal in common. Medicus IT, which was founded in 2004, is one of the largest healthcare informatics MSPs in the nation, operating from offices in Alpharetta, Georgia, and Phoenix, Arizona, at the time. CompuTech City, which was started in 2002 in Orlando, Florida, was known for taking a relationship-based approach to supporting its healthcare clients’ IT needs. Both companies prized skilled employees who could leverage the latest technical advances to help healthcare clients manage compliance and compete in an industry with complex third-party reimbursement.

From a 60,000 foot view, joining forces looked like the proverbial “slam dunk.”

Synergies Abound When Healthcare Leaders Merge

"“Our companies served the same industry, and I had known Saurin Patel for several years,” said Chris Jann of Medicus IT. “Together, we could become one of the largest MSPs in the healthcare market vertical, and size would enable us to keep pushing the boundaries of technology in service of our clients and our mission of bettering healthcare.”

“Our plan was to continue on a growth path and sell in 2025 when this opportunity came up,” said Saurin Patel of CompuTech City. “We liked Medicus IT’s product, industry and culture, and the two companies perfectly matched each other.”

Jann and Patel knew the devil of this transaction would be in the details:

  • How would each company determine its value?
  • How would they agree on their value to each other?
  • Was the elusive “plus” factor that would make the transaction of value really there?

And if these questions were answered to their satisfaction, how would these two ultra-busy executives find the time to complete the exhaustive process of due diligence, valuation and negotiation?

Enter Cogent Growth Partners, the leading M&A advisor in the IT Service Provider space. Because Cogent was known to and trusted by both top executives, it was just the objective third-party that these healthcare IT executives needed. “Cogent did an excellent job for us on this transaction,” said Patel. “Their deep knowledge of the transaction, buyer and seller languages was invaluable to us.”

With more than 150 completed IT merger and acquisitions transactions behind them, the Cogent team knew its way around the transaction table. Cogent was charged with conducting pre-LOI due diligence for each company, negotiating a Letter of Intent that would be acceptable to both sides and shepherding the transaction all the way through to the closing. “Cogent kept the due diligence and valuation processes moving, which saved our side a great deal of time,” said Jann. “I look forward to working with them again as our company continues its trajectory toward market dominance.”

Buyers and sellers of MSPs view mergers and acquisitions as an important way to grow market share and secure talent. “For business owners and top executives, finding the time to gather and process all of the myriad information needed to complete discovery due diligence, negotiate an acceptable Letter of Intent, and create and manage all of the confirmatory due diligence to take the deal to the closing takes time away from running our companies,” said Jann.

For many, delegating these activities to an objective third party with deep M&A experience puts time back on the clock for business owners and executives who need 25-hour days.

About Medicus IT

Medicus IT continues to grow in the healthcare vertical and now has operations in Alpharetta, Georgia; Phoenix, Arizona; Orlando, Florida; Newark, New Jersey; Columbus, Ohio; and throughout California. The company is advancing its mission of providing better healthcare experiences by turning tech that’s a burden into system and proactive solutions that make a real difference every day. As a result of Medicus IT’s efforts, healthcare providers can focus on what matters most – their patients.

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