Behind the scenes: EQT’s Waystar unites with Francisco’s eSolutions in $1.3bn-plus deal

EQT-backed Waystar is buying Francisco Partners' eSolutions in a deal valued between $1.3 billion and $1.4 billion.

Good morning!

Another week, another big healthcare technology deal.

This time around, eSolutions’ formal time on the market came and went in a matter of about four weeks.

Putting a stop to an entirely virtually-run process that kicked off only about a month ago, revenue-cycle-management giant Waystar agreed to buy Francisco Partners’ eSolutions in a deal valued between $1.3 billion and $1.4 billion, I learned. Read my story for all the deets.

But there’s more to the story: To the outside world, it looks as though the deal came together quickly. The reality is, Waystar, under the backing of EQT, CPIBB, and Bain Capital, has been doing work on eSolutions for at least seven or eight months, a source close to the deal told me.

The parties originally initiated discussions last fall – with EQT, CPPIB, Bain and the two management teams all meeting in person in eSolution’s Kansas headquarters. Waystar would have happily bought eSolutions then, but the company wasn’t ready to be assessed, the source said.

Come March, the pandemic quickly stalled most sale processes. But Waystar had another benefit over other PE funds bidding for eSolutions when it became available this summer. Being that Waystar and eSolutions both operate in RCM, Waystar already had an inside look at what was happening with its claims volumes through the downturn. Revenue is a function of claims volume at an RCM company, so this allowed Waystar to diligence and match what they were seeing with eSolutions, a source said.

Strategically, the marriage of the two companies makes a lot of sense.

Besides revenue and cost synergies, eSolutions fills an important gap for Waystar. The acquisition significantly bolsters its revenue cycle and workflow management tools tailored to the Medicare market – an increasingly important and growing area of healthcare reimbursement.

The combination also creates the first RCM player to manage and improve revenue collections across both commercial and government payers.

On another note, the deal marks another win for Francisco Partners this summer. ICONIQ Capital, known for its ties to tech billionaires, joined Francisco as an investor in QGenda – bringing the workforce-management company’s valuation to surpass $1 billion. Read more.

Stay tuned for more analysis on Waystar-eSolutions later today.

Top Scoops
Wound care: In case you missed it, One Equity Partners acquired American Medical Technologies, extending the New York firm’s expertise across the post-acute healthcare universe.

Led by the firm’s Greg Belinfanti and Brad Coppens, OEP sees significant growth potential for AMT. The country’s diabetes problem, favorable reimbursement dynamics and increasing demand across post-acute care settings are set to favor AMT as it pursues organic growth and additional M&A.

Check out my full report for more behind OEP’s strategy.

Tech for autism treatment: K1 is betting on the growth of the telehealth market through Rethink First. I first wrote the company was seeking backing in late 2018.

Check out my colleague Milana Vinn’s story.

That’s it for me today. As always, reach me at with any feedback, tips or just to say hello.