IPO FILING: MedAssets

MedAssets, Inc. has filed to come public via an IPO and it will raise up to $230 million in security sales for filing purposes.  It has secured the NASDAQ ticker "MDAS" and its underwriting group is quite large: Morgan Stanley and Lehman have been designated as the lead underwriters and Deutsche Bank and Goldman Sachs were listed as joint book-runners; co-managers are listed as Piper Jaffray, William Blair, and Wachovia.

MedAssets provides technology and services to deliver solutions designed to improve operating margin and cash flow for hospitals and health systems. It believes its solutions have the potential to improve customer operating margins by 1.5% to 5.0% of revenues through increasing revenue capture and decreasing supply costs.  MedAssets’ solutions integrate into customers’ existing operations and enterprise software systems and are designed to require minimal upfront costs or capital expenditures.

Its Revenue Cycle Management segment currently has more than 1,000 hospital customers, and its Spend Management segment manages approximately $15 billion of supply spending by healthcare providers and has more than 1,700 hospital customers.  For the twelve months ended December 31, 2006, it generated net revenue of $146.2 million, net income of $8.6 million and Adjusted EBITDA of $50.8 million; and on a pro forma basis it shows net revenue of $177.9 million, net loss of $6.6 million and Adjusted EBITDA of $56.2 million. The financials are more of a recently combined effort because it acquired privately held XactiMed just in mid-May.

Jon C. Ogg
August 27, 2007

Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.