IMS Health could raise $1.36 billion in IPO: Reuters

Healthcare IT player IMS Health is expecting to price its initial public offering at between $18 and $21 a share, which would value the company at $6.97 billion, according to a report from Reuters.

The company, backed by TPG Capital Management (Fort Worth, TX, USA), is hoping to raise as much as $1.36 billion from the sale of 65 million shares.

According to Reuters, IMS (Parsippany-Troy Hills, NJ, USA), will sell some 52 million shares during the offering, with the remainder being put up for sale by shareholders.

“Right now there is big demand for IPOs that are subscription and cloud based,” said Francis Gaskins, a research director at Equities.com, according to Reuters.

Besides providing prescription data to pharmaceuticals companies, medical device makers and governments, IMS develops reports about the status of the healthcare industry, and generated 90% of its information revenue over the last three years from the sale of subscription or license-based contracts.

It currently serves about 5,000 customers in 100 countries worldwide and had a total debit of $4.96 billion at the end of 2013, according to Reuters.

The offering will reduce the stake in IMS held by TPG to about 50% from a current level of 62.2%.

Besides growing its operating profit to $276 million for the nine months between January and September 2013 – from $173 million for the corresponding period in 2012 – IMS has acquired a number of other healthcare IT providers since being taken private by TPG in 2010.

Those have included Incential Software, 360 Vantage, Semantelli and Appature.

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