Waystar to Acquire Iodine Software for $1.25B, Enhancing AI-Powered Healthcare Platform

Waystar Holding Corp. has agreed to acquire Iodine Software in a $1.25 billion deal, aiming to enhance its AI-powered healthcare platform. The acquisition is expected to close by the end of 2025 and will integrate Iodine's AI engine, IodineIQ, into Waystar's cloud-based platform. The combined entity is projected to serve 17 of the 20 US News Best Hospitals and increase Waystar's total addressable market by over 15%.

Waystar Holding Corp. has agreed to acquire Iodine Software Holdings, Inc. in a $1.25 billion deal, aiming to enhance its AI-powered healthcare platform. The acquisition, announced on July 24, is expected to close by the end of 2025 and will integrate Iodine's AI engine, IodineIQ, into Waystar's cloud-based platform. The combined entity is projected to serve 17 of the 20 US News Best Hospitals and increase Waystar's total addressable market by over 15%.

Waystar, a healthcare payments and RCM technology provider, specializes in cloud-based solutions for healthcare payments. Iodine, on the other hand, focuses on clinical AI solutions, including clinical documentation and revenue optimization. The merger aims to combine these complementary technologies to create an end-to-end RCM platform powered by AI.

The acquisition is expected to be funded with an even split of cash and stock. Waystar shareholders will own approximately 92% of the new combined company, while Iodine equity holders will own about 8%. Advent, the largest shareholder of Iodine, will receive Waystar shares and has agreed to an 18-month lock-up period post-closing.

The integration of Iodine's AI engine, IodineIQ, is expected to automate tasks and improve financial and clinical outcomes for healthcare providers. The companies anticipate more than $15 million in cost synergies within the first two years after the closing. The combined entity will serve a large portion of U.S. health systems, physician groups, and ambulatory services, positioning it as a dominant player in the healthcare RCM space.

Waystar is advised by Simpson Thacher & Bartlett LLP, while Iodine is advised by Weil, Gotshal & Manges LLP and Queen Saenz + Schultz PLLC. The deal is subject to customary regulatory approvals.

References:
[1] https://lawstreetmedia.com/insights/ai-advantage-waystar-to-acquire-iodine-software-for-1-25b/
[2] https://uk.finance.yahoo.com/news/waystar-acquire-iodine-software-1-041409436.html