Healthcare Software Firm Waystar Goes IPO Way With Potential $8B Valuation

Waystar Inc, a provider of financial management software for hospitals and medical practices, is reportedly making strides toward an initial public offering (IPO) that could value the company up to $8 billion.

The company's current owners, private equity firm EQT AB and the Canada Pension Plan Investment Board, have enlisted the services of Goldman Sachs Group Inc and JPMorgan Chase & Co to guide them through the IPO process, Reuters stated. 

The IPO is anticipated to materialize later this year or early in the next, contingent upon favorable market conditions. The valuation Waystar ultimately attains will also be contingent on market dynamics.

Formed in 2017 due to the merger between Navicure and ZirMed, Waystar specializes in payment software solutions that efficiently collect bills from patients, catering to a diverse client base, including large hospital systems. 

When EQT and CPPIB secured a majority stake in Waystar in 2019 from Bain Capital, the company was valued at $2.7 billion. Bain Capital remained a minority investor following the transaction, and all three entities are represented on Waystar's board of directors.

Under the stewardship of EQT and CPPIB, Waystar has expanded its scale through the strategic acquisition of its competitors, a notable instance being the integration of eSolutions in 2020. 

This acquisition bolstered Waystar's presence in the government health insurance sector, particularly within Medicare, which provides health coverage for older people. Waystar collaborates with approximately 1 million healthcare providers and manages over 2.5 billion transactions annually.

Fitch analysts tracking Waystar's existing debt are optimistic about the company's prospects, citing the burgeoning healthcare industry propelled by an aging population and heightened expenditure. 

As Waystar navigates the intricate path to its IPO, industry observers will closely monitor how the company leverages its software solutions to navigate the ever-evolving landscape of healthcare finance, potentially solidifying its position as a significant player in the industry while creating value for its stakeholders.