InformationWeek
Defining The Business Value Of Technology
Systems Integration Sensation
Medaphis to double IT business with two acquisitionsBy Bruce Caldwell
Issue date: March 25, 1996
Medaphis Corp., a $467 million supplier of business management services to the health-care industry, has transformed almost overnight into a major systems integrator in the client-server world.
Most of Medaphis' business involves functions such as billing, collections, financial services, office management, and record storage for medical practices and hospitals. But the Atla nta company also has a computer services business that is about to double in size. Medaphis announced March 15 that it has agreed to acquire BSG Corp., a $69 million client-server integrator, for $350 million in stock.
Three days earlier, Medaphis said it would acquire Rapid Systems Solutions Inc., a $14 million client-server integrator, for $43 million in stock. It plans to merge BSG and Rapid Systems with its existing technology services business into a $150 million, 1,500-employee unit under the BSG name.
Steve Papermaster, who will retain his titles as chairman, CEO, and president of BSG, says being acquired by Medaphis will give BSG the resources to take on larger client-server projects. The deal "accelerates our business plan by two to three years," he says.
John Kallelis, VP of IT at Aramark Corp., a diversified services company in Philadelphia, where BSG has worked for two years on a systems integration project, says the Medaphis acquisition is "a pleasant su rprise" that will give BSG access to rapid application development skills, more national coverage, and capital for expansion.
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