TriZetto Corp., the Englewood, Colo.-based care management, administration, and billing software vendor, is being bought by Cognizant, the Teaneck, N.J.-based consulting and business process outsourcing services company, for $2.7 billion in cash.
Leaders at the publicly-held Cognizant say that the privately-held TriZetto will boost its healthcare business. The company's healthcare revenues accounted for 26 percent of total revenue in 2013.
"Healthcare is undergoing structural shifts due to reform, cost pressure and shifting responsibilities between payers and providers. This creates a significant growth opportunity, which TriZetto will help us capture," Francisco D'Souza, CEO of Cognizant, said in a statement. "We are excited that the integrated portfolio of capabilities across technology and operations will uniquely position us to help clients drive higher levels of operational efficiency, while re-imagining care for the future. We look forward to welcoming the TriZetto team into the Cognizant family and creating a truly differentiated and sustainable foundation for healthcare."
Cognizant says the 3,700 TriZetto employees will be a part of Cognizant's existing healthcare business. The two companies had long-term relationship previous to this acquisition.
Cognizant intends to finance the transaction through a combination of cash on hand and debt, and has secured $1 billion of committed financing in support of the transaction. The transaction is expected to close in the fourth quarter of 2014.