Netsmart Technologies Inc., a healthcare information technology company has hired an investment bank to explore an auction process while concurrently prepping the company to make its IPO. The Overland Park, Kan.-based company is backed by Genstar Capital Management LLC, which has owned the company since 2010. Previous to this, Netsmart was taken private by Insight Venture Partners and Bessemer Venture Partners in November 2006 for $16.50 per share or $115 million. A possible sale of the company–based on bankers’ estimates of EBITDA over $50 million–could bring in 15x EBTIDA or $750 million. Netsmart is seen as a top notch player in the behavioral health space that it serves. It works in the behavioral health, care coordination, child and family services, intellectual and developmental disabilities, public health, addiction treatment and private practice markets. The company provides services for electronic health records, care coordination, analytics, consumer engagement and revenue cycle management facilities management, among others. Netsmart is seen as attractive because of the behavioral health market, which has seen increased interest since the Affordable Care Act included behavioral health as one of the 10 elements of essential health benefits.
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