Before yesterday’s opening bell, Medical Transcription Billing, Corp. (NASDAQ: MTBC) (NASDAQ: MTBCP) announced the closing of its largest acquisition of revenue cycle management customer accounts and other assets to date. The acquisition, which was completed by MTBC subsidiary MTBC Acquisition Corp., includes substantially all of the assets of both Texas-based MediGain, LLC, and its affiliate, New Jersey-based Millennium Practice Management, LLC. Moving forward, the addition of the two medical billing firms to MTBC’s existing operations is expected to greatly expand the company’s client base, positioning it for significant revenue growth in 2017 and beyond.
“We are excited by the opportunity presented by this acquisition and privileged to be able to support the team members formerly with MediGain as they continue to provide world class practice management support to healthcare providers throughout the United States,” Stephen Snyder, president of MTBC, stated in this morning’s news release. “We look forward to leveraging our combined team of professionals and proprietary technology to help healthcare providers further increase revenues and reduce operating costs.”
Established in 2002, MediGain currently offers an integrated portfolio of leading information technology, process and domain expertise solutions designed to address factors that could impact the financial health of medical practices, clinics, hospitals and other essential providers. MTBC’s acquisition of MediGain includes its database of existing customer accounts, intellectual property portfolio and offshore operations in India and Sri Lanka. Bill Korn, chief financial officer of MTBC, added that the acquisition was completed “at a compelling valuation that represents a significant discount as compared to the industry norm of at least one times annualized revenues for a company of MediGain’s size.”
With its largest acquisition since its IPO now completed, MTBC will look to build on its recent financial performance. In August, the company reported its financial results for the second quarter of 2016, which included quarter-over-quarter revenue growth for the first time since the fourth quarter of 2014. This achievement is significant, as it reflects the continued stabilization of MTBC’s operations following the completion of three simultaneous acquisitions at the time of its IPO in 2014.
The company’s efforts to increase its share of the health care information technology market aren’t limited to its recent M&A activity. Just last month, MTBC announced the launch of its Client Loyalty Program, a first-of-its-kind initiative designed to reward health care provider clients with shares of its common stock. The company has set aside 100,000 shares, which were in treasury stock following a share repurchase program completed earlier this year, to use as rewards for customer loyalty and referrals, offering 100 shares to each provider who is a medical billing client and 1,000 for each referral of a medical practice which becomes an MTBC client. Korn highlighted the potential advantages of the program in a recent news release.
“[W]hen clients own a stake in the company, they act as strategic partners and contribute to the success of the company,” he added. “Savvy investors recognize that the long-term benefits, in terms of client retention and referrals of new business should far outweigh the cost of the program.”
For more information, visit www.MTBC.com
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