Induction Healthcare to acquire digital patient platform Zesty

Induction Healthcare has entered into a conditional share purchase agreement to acquire Zesty - a digital healthcare patient engagement platform company - for a consideration of £0.5m cash and the issue of 12,424,527 new ordinary shares, it announced on Tuesday.

The AIM-traded healthcare technology company said Zesty's platform provides an integration layer with a hospital's electronic patient record or patient administration system, and a portal that allows patients to manage their hospital outpatient appointments, read their administrative and clinical correspondence, attend a video-based consultation, and store a personal copy of their clinical record through that integration layer.

For the year ended 31 December 2018, Zesty reported revenue of £1.04m and a net loss before tax of £0.51m, with a net current asset position of £0.33m at year-end.

Induction said that, by integrating Zesty's technologies with its own, the enlarged group would be “one of the first” technology platforms to interconnect patients, clinicians and healthcare information across both multiple hospital sites and electronic patient record platforms.

The board said it expected the acquisition to provide a number of benefits, including synergy of sales, software development, and management, with James Balmain to be appointed as joint chief executive officer, sharing with current CEO Dr Hugo Stephenson.

It added that the appointment of James Balmain and Andrew Williams to the Induction board at completion would bring their experience to the enlarged group.

Balmain has “extensive” technology experience and relationships with NHS Trust c-suites, with Williams having experience and connections in healthcare IT including, having been CEO of NHS Digital.

On, or shortly following, completion of the acquisition, Induction said it expected Ibraheem Mahmood to step down from the board, but continue in a business development role, primarily focused on mergers and acquisitions and fundraising.

The consideration shares would represent around 41.9% of the existing issued share capital of Induction and would, when issued, represent about 29.5% of the enlarged share capital.

“Zesty has demonstrated that it can improve patient experience while saving hospitals time and money through its market leading patient portal and outpatient bookings engine,” said CEO Hugo Stephenson.

“In the process, Zesty has solved the problem of integrating with different electronic patient record systems.

“Connecting the most used app by NHS doctors - Induction - and the most used app by NHS trusts - MicroGuide - with patients and their health records, has the potential to deliver the right resources to the right places at the right time - a transformational opportunity for healthcare."

James Balmain, CEO of Zesty, added that he witnessed the “frustration” that clinical teams and patients felt regularly, explaining that “basic” tasks, such as updating a patient record or booking an appointment were not made “easy enough”.

“So an app for doctors, connected to an app for patients makes total sense. Induction and Zesty coming together can help improve the way healthcare is delivered.

“I am excited by the reach and capability of the new combined Induction group.

“We will be working as hard as we can to help bring clinical teams and patients together, in an efficient and low-friction way.”