Pegasystems Acquires 1mind Corp.
Pegasystems, a software developer of process automation for CRM, announced earlier this week that it will acquire 1mind Corporation, a privately held provider of CRM and e-business solutions for healthcare payer and insurance companies.
Based in Cambridge, Mass., Pegasystems provides rules technology that allows companies to aggregate diverse business practices and lets business managers implement change across the enterprise and over the Web. Companies use Pegasystems' products to enhance their CRM strategies.
The 1mind deal will be structured as a purchase of 1mind's assets for shares of Pegasystems' common stock valued at approximately $3.6 million dollars. Up to approximately $6 million of additional Pegasystems' stock may be issued in 2003, as additional consideration.
Pegasystems believes that the acquisition will increase its penetration of the healthcare and insurance markets, strengthen its management and delivery teams and deepen its product offerings. The solutions emerging from the acquisition will help address the growing needs of the healthcare and insurance markets, in areas such as: HIPAA compliance; claims exception processing productivity; and improved customer and member satisfaction.
On the business front, Pegasystems hopes to increase its Blue Cross Blue Shield customer base and capture approximately 18 percent of the insurers. Indeed the key asset of 1mind is its customers, which include: Anthem Blue Cross Blue Shield of New Hampshire; Blue Cross Blue Shield of Rhode Island; Horizon Blue Cross Blue Shield of New Jersey; Blue Cross Blue Shield of Montana; Allianz Life Insurance Company; and Northeast Delta Dental. "The acquisition of 1mind will help position Pegasystems as a leader in the CRM healthcare and insurance markets," said Rick Jones, president and COO, Pegasystems.
Tom Congoran, president of 1mind and former COO of Blue Cross Blue Shield of New Hampshire, will join Pegasystems as the leader of its newly formed healthcare and insurance business unit. Pegasystems will continue to offer 1mind's sales and marketing, underwriting and enrollment applications.
At least one analyst was bullish on the news. "This acquisition reflects the trend toward providing full function, industry-specific CRM product suites to today's healthcare market," commented Joanne Galimi, research director, Gartner Inc. "More importantly, it helps expand the use of rules based process automation, a key requirement for profitable, enterprise wide customer service automation."
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