Starr, Partners Group lead purchase of MultiPlan

AP News
Posted: Feb 17, 2014 12:49 PM

NEW YORK (AP) — A group led by Starr Investment Holdings said Monday that it is buying MultiPlan Inc., which helps manage claims for large health insurers.

The purchase price was $4.4 billion, according to a person close to the deal, who spoke on condition of anonymity because the companies did not publicly disclose terms.

Starr and Switzerland-based Partners Group said their group had agreed to buy MultiPlan from private equity firms Silver Lake and BC Partners.

Starr is part of C.V. Starr & Co., which is led by former American International Group Inc. CEO Maurice "Hank" Greenberg.

MultiPlan says on its website that it has nearly 900,000 health care providers under contract and processes 40 million claims a year for payers in health care and other markets.

Private equity firms like Silver Lake typically make investments for a short period, perhaps three to five years. Starr and Partners Group are taking a longer view and believe that there will be growth in the business of analyzing and managing claims at a time of rising medical costs.

Starr had connections to MultiPlan. According to the person familiar with the deal, Greenberg has a long-standing relationship with MultiPlan CEO Mark Tabak, and a member of the Starr investment team worked at Carlyle Group when that private equity firm owned the health care services company.

Carlyle and another firm sold MultiPlan to Silver Lake and BC Partners in 2010. Published reports at the time valued that deal at $3.1 billion.

The sale announced Monday included financing from Barclays PLC and J.P. Morgan Chase & Co. It is expected to close by the end of the first quarter.