ISoft sells Business Solutions to Capita

ISoft, one of the main suppliers to the National Programme for IT in the NHS, has sold its iSoft Business Solutions subsidiary to British outsourcing firm Capita.

The company has sold the business, which provides financial management, purchasing and e-business solutions in the UK and Ireland, and is considered a “non core” part of the company for £23.2m (AUS $37.4m).

As reported by E-Health Insider last week, the company has been looking to offload iBS, which has offices in Dublin and Belfast.

ISoft has been struggling with adverse exchange rates, high costs, and lower revenues, in part related to the late running of NPfIT. Its Lorenzo electronic patient record is due to be delivered to three fifths of the English NHS by local service provider CSC.

ISoft also sold its Monet GP administration software, which is used in Australia and New Zealand, in October this year.

A company spokesperson said the two sales together will make £18m (A$28.5m) available to pay fees related to refinancing and reducing group debt.

According to the company, iBS generated revenues of £17.7m and EBITDA of £5.8m in the year to June 30 2010.

ISoft’s chief executive officer, Andrea Fiumicelli, said: "While iBS is a profitable business, its key products - Oracle's e-business suite and Integra financial accounting solutions - have little overlap with iSoft's proprietary core patient-focused healthcare IT business.

“Given this, and our strong desire to reduce debt, the divestment was deemed appropriate and in line with our strategy of focusing on core, patient-specific health care products going forward."

Last week, iSoft declined to comment on whether iBS was up for sale. However, when asked by a shareholder during the company’ annual general meeting whether the whole business would be put up for sale, chairman Robert Moran said: “Yes, it’s one of the options.”

When iBS sale was announced this morning, iSoft’s shares rose by 0.7 Austrailia cents, to 8.7c. But the share price has since slipped back to 8 cents.

The company says that the size of iSoft's bridge facility will be reduced from GBP40m (AUS $64.5m) to £23.2m (AUS $37.4m) and that iSoft’s UK and Ireland healthcare business remains unaffected by the sale.