Netsmart Technologies Inc., the Great River-based
provider of software for health and human services organizations, said
yesterday it has agreed to be acquired by two venture capital companies for
Netsmart said it has agreed to be acquired by Insight Venture Partners,
After the deal is concluded, Netsmart will no longer be a publicly traded
company on the Nasdaq exchange.
Shareholders will receive $16.50 a share, a 23.5 percent premium to the
average closing price of $13.36 over the past 20 days.
Netsmart shares closed yesterday at $16.13, up $1.43.
Stockholder and regulatory approvals will be necessary before the deal can
be concluded, which Netsmart said it hopes to do early in 2007.
The company said its executive management team "will participate in the
ownership of the company."
"We believe this transaction will enable us to better scale for anticipated
growth, both organically and by acquisition, and will provide us with easier
access to capital for new product development and technology innovations to
better service our customers," James L. Conway, Netsmart's chairman and chief
executive, said in a statement before the markets opened yesterday.
Netsmart's announcement said Bessemer Venture Partners is the oldest
capital practice in the United States and manages some $2 billion in venture
funds. More than 100 Bessemer companies have gone public, including Gartner
Group, Staples and W.R. Grace.
In its latest fiscal quarter, Netsmart reported revenue of $15.3 million,
an 81 percent increase over the same period last year.
The company earned about $1 million in the quarter that ended Sept. 30,
compared with $379,000 for the similar period last year.
Netsmart has made a few acquisitions of its own. In August it acquired a
business unit of Intelligent Systems Corp. of Norcross, Ga., and in 2003 it
bought most of the assets of CareNet, the health care division of Adia
Information Management Corp. of Ann Arbor, Mich.
Netsmart has about 322 employees on Long Island.