CSC has confirmed it is buying Australian software firm iSoft for approximately $188 million (£116 million).
The move means that CSC, which runs NHS IT in North and central England under the troubled National Programme for IT, will acquire the maker of the patient administration software it is installing.
The purchase comes at a 224 percent premium to iSoft’s closing price on 24 March, Reuters reported.
CSC chief executive Michael Laphen said: “Through our combined experience in global healthcare delivery, complementary world-class healthcare software solutions, and enhanced capabilities in system integration, outsourcing and process management, we are forming a compelling lifecycle of services to better serve our global clients and improve patient care.”
CSC’s iSoft Lorenzo system rollout in the NHS has missed government deadlines, and on 4 February the Department of Health issued the supplier with a breach of contract notice. CSC is understood to dispute the notice.
The supplier said the acquisition of iSoft would bolster its healthcare research and development, and as well as aiding its growth in life sciences. It is subject to the approval of iSoft shareholders and market regulators.
iSoft employs 3,300 staff, with development centres in India, Spain, UK, Australia, New Zealand and Central Europe.
Douglas Hayward, research director at analyst house IDC, described the acquisition as “reluctant” but “understandable” on the part of CSC.
“[CSC is] doing the right thing - they have no choice,” he said. “They're in an bind and they simply have to make the best of a difficult situation. A more integrated and tighter supply chain should help CSC to really sort out ISoft - once and for all.”
“CSC is currently holding a weak hand of cards in its dealings with the NHS, and it has to demonstrate its commitment. If this doesn't work, nothing will.”