Olive AI has sold substantially all of its assets to Waystar and Humata Health

Olive AI

Olive AI is leading healthcare revenue cycle management (RCM) software provider that leverages the power of artificial intelligence (AI), machine learning and other automation technologies to remove the need for human intervention in collecting compensation for care for the nation’s largest health systems. The company’s solutions automate high-volume repetitive administrative workflows in the revenue cycle, including coverage identification and eligibility verification, claims and remittance processing and end-to-end prior authorization.

The Deal

Owing to various operational and macroeconomic market factors, Olive experienced significant liquidity constraints and an inability to service its debt obligations. Despite significant cost reductions and organizational restructuring efforts, including multiple reductions in force and the divestiture of non-core assets, the company’s path to profitability remained uncertain. Olive engaged Lincoln International to launch an extensive marketing process to explore all potential transaction alternatives over a significantly compressed timeline.

Lincoln worked closely with the company’s management team, its operational advisor and legal counsel to conduct a highly efficient out-of-court sales process, ultimately selling the Clearinghouse and Patient Access business to Waystar and the Prior Authorization business to Humata Health via separate asset purchase agreements. Immediately upon being engaged, Lincoln swiftly secured incremental liquidity from the existing lender and launched a broad process to buyers within two weeks of retention for the sale of the company in its entirety or in parts. Lincoln evaluated multiple transaction structures and alternatives for the company’s board and conducted various analyses to help buyers assess the opportunity. Lincoln leveraged competitive tension to drive buyers to a timely close and successfully close two out-of-court transactions before the company’s liquidity ended.

Our Perspective

Brendan Murphy, Lincoln International Managing Director who co-led the transaction, commented, “We are pleased to have advised Olive AI through this challenging and complex situation in an expedited manner. By exploring numerous transaction structures and strategic alternatives, we were able to find the right partners to support Olive’s long-term objectives at a critical inflection point in the healthcare RCM industry. It was a pleasure to work collaboratively with Cooley and Paladin Management Group to navigate a highly complicated, out-of-court sale process that yielded a creative outcome for all stakeholders.”

Mike Siano, Lincoln International Managing Director who co-led the transaction, added, “We enjoyed working with the Olive, Waystar and Humata Health teams on this important transaction. The acquisitions by Waystar and Humata Health strategically position the companies to further advance Olive’s mission to automate administrative workflows in the healthcare revenue cycle. We look forward to the continued growth and success of the combined platforms.”

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