Global Payments announced it will sell its medical software unit, AdvancedMD, to the investment firm Francisco Partners for $1.13 billion. The move aligns with Global Payments’ strategy to concentrate on core financial technology services. Following the announcement, Global Payments’ shares rose by nearly 4%, partly boosted by news of a $600 million accelerated stock buyback plan, funded by proceeds from the sale.
Analysts at William Blair view the sale positively, noting that it “sharpens focus, reduces exposure to the challenging healthcare market, and returns capital to shareholders.” This sale follows a broader industry trend in which companies streamline operations to prioritize high-growth areas over broader expansion.
Global Payments CEO Cameron Bready emphasized this targeted approach, previously stating, “We recognize that global does not mean everywhere.”
In addition, Global Payments reported a nearly 13% decrease in third-quarter profit due to rising operational costs. Founded in 1999, AdvancedMD provides payment processing and software services to independent doctors and mid-sized healthcare providers in the U.S. Global Payments initially acquired AdvancedMD in 2018 for $700 million.
Some analysts, including J.P. Morgan’s Tien-tsin Huang, had not anticipated the sale, considering AdvancedMD a potentially valuable asset due to its “stickiness and payment monetization.” Francisco Partners, which had previously invested in AdvancedMD, has made similar acquisitions of healthcare units from major firms like CVS Health, IBM, and Qualcomm in recent years.
The deal is anticipated to close in the fourth quarter, with Francisco advised by Moelis & Co and Global Payments by Bank of America.
