By Lisa Kerner
Charlotte, N.C., Sept. 8 - Healthaxis Inc. will become the health-care division of BPO Management Services Inc. following a reverse merger between the two companies.
Each share of BPO common stock will be exchanged for 0.3393 shares of Healthaxis common stock.
Shares of BPO preferred stock and other BPO securities will be exchanged for a mix of shares of Healthaxis common stock, preferreds and other securities based on various fixed exchange ratios, a BPO news release said.
Healthaxis said it will effect a reverse stock split in connection with the transaction's closing, which is expected during the fourth quarter of 2008.
The surviving publicly held company, to be known as BPO Management Services Inc., will have a "significantly streamlined" capital structure compared to either of its predecessors, BPO said.
An annual revenue run rate of approximately $50 million is projected for the combined company.
"By combining our operations with BPO, we not only improve our internal operating capability, but we also broaden our reach within the health care payer industry," Healthaxis chief executive officer John M. Carradine said in the release. He will lead the new health-care division of BPO.
"We are putting in place a dedicated BPOMS sales force that will aggressively sell Healthaxis products and services to our mid-market target customers with annual sales of $500 million to $3 billion," BPO CEO Patrick Dolan added in the release.
Dolan said the merger gives BPO an opportunity to target a larger portion of the health-care claims processing and benefits administration industry, which is valued at approximately $100 billion annually.
Based in Anaheim, Calif., BPO is a business-process provider focused on on-demand human resources, information technology, enterprise content management and finance support.
Healthaxis is a provider of health-care payer solutions located in Irving, Texas.
| Acquirer: | BPO Management Services Inc.
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| Target: | Healthaxis Inc.
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| Announcement date: | Sept. 8
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| Price per share: | BPO common stock will be exchanged for 0.3393 shares of Healthaxis common stock
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| Expected closing: | Fourth quarter of 2008
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| Stock price for acquirer: | OTCBB: BPOM: $0.16 on Sept. 5
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| Stock price for target: | Nasdaq: HAXS: $0.41 on Sept. 5
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