After the deal closes,Athenahealth will be combined with Virence Health, Veritas'shealth-care services company. (Photo: Shutterstock)

Private-equity firm Veritas Capital and Elliott Management Corp.will acquire Athenahealth Inc. for $135 per share, ending amonths-long, sometimes-contentious process to push the healthrecords company into a sale.

The all-cash transaction values Athenahealth at about $5.7billion, the firms said in a statement announcing the transactionMonday. The price is a 12 percent premium to where the sharesclosed on Friday.

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Athenahealth rose 9.2 percent to $131.45 at 9:04 a.m. in NewYork, before the market opened.

After the deal closes, Athenahealth will be combined withVirence Health, Veritas's health-care services company, the firmssaid. Virence offers hospitals and physician practices services tomanage their revenue and workflow. The combined company will keepthe Athenahealth name, and will be led by Virence Chief ExecutiveOfficer Bob Segert.

A sale has been pushed by Elliott, the sometimes-activist fundrun by billionaire Paul Singer. Earlier this year, New York-basedElliott went public with a 9 percent stake in Athenahealth, andsaid it was prepared to offer $160 per share for the company,subject to due diligence. Elliott said that the company, whichprovides online business services including billing for health-careproviders, had been mismanaged and failed to grow as much as itshould have.

Athenahealth refused Elliott's proposal. The company has beenformally exploring a sale since June, when Chief Executive OfficerJonathan Bush stepped down following allegations of misconduct.

“Operating as a private company with Veritas's ownership andsupport will provide Athenahealth with increased flexibility toachieve our purpose of unleashing our collective potential totransform health care,” said Jeff Immelt, the former GeneralElectric Co. CEO who has been Athenahealth's executivechairman.

Elliott's private equity arm, Evergreen Coast Capital, will keepa minority stake in the new company. The deal is expected to closein the first quarter of 2019, the firms said.

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