(Bloomberg) -- UnitedHealth Group Inc. and Vista Equity Partners are nearing a deal to acquire and split up the health and education consultant Advisory Board Co., according to people familiar with the matter.
UnitedHealth would acquire Advisory Board's health-care division and Vista would buy its education business, said the people, who asked not to be named because discussions are private. The education unit may sell for as much as $1.5 billion, one of the people said.
Shares of Washington-based Advisory Board jumped as much as 14 percent Thursday to the highest level in two years. The stock was up 4.8 percent at $54.75 as of 3:51 p.m. in New York, giving the company a market value of $2.2 billion.
Vista has focused on high-growth software companies in recent years. First-quarter education revenue at Advisory Board, while comprising only 33 percent of the company's overall sales, grew 15 percent from a year earlier. Health-care sales declined 6.6 percent, excluding exited programs.
No deal is assured, and an announcement could be up to a month away given the complicated structure of the deal, the people said.
Spokesmen for Advisory Board and UnitedHealth declined to comment. A Vista spokesman didn't immediately respond to a request for comment.
UnitedHealth, the biggest U.S. health insurer, has a sprawling technology, consulting and health-care delivery operation known as Optum. The company's consulting unit focuses on aiding leaders of hospitals and insurers, implementing new technologies and advising health plans on how to design products and set rates.
Advisory Board's consulting and research projects include collecting bills after care, improving patient care and helping hospitals and doctors with strategy and planning.
Activist investor Elliott Management Corp. disclosed an 8.3 percent stake in Advisory Board in January. Elliott said it wanted to “engage in a constructive dialogue with the issuer's board of directors regarding opportunities to maximize shareholder value.” Elliott reached a standstill agreement with Advisory Board in March after the company agreed to explore strategic alternatives including a possible sale.
Advisory Board has been working with Goldman Sachs Group Inc. and Allen & Co. to find buyers.
To contact the reporters on this story: Alex Sherman in New York at asherman6@bloomberg.net, Kiel Porter in New York at kporter17@bloomberg.net, Zachary Tracer in New York at ztracer1@bloomberg.net.
To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, Drew Armstrong at darmstrong17@bloomberg.net, Devin Banerjee, Michael Hytha
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