SAN FRANCISCO, Nov. 29 /PRNewswire/ -- Definity Health, a private Minneapolis based company that provides self-funded health benefit plans to employers, today announced a definitive agreement to be acquired by UnitedHealth Group for approximately $300 million in cash. The acquisition of Definity, founded in 1998, demonstrates increasing availability of viable exit options for companies that survived the post bubble recession. Alta Partners was an initial investor in Definity Health betting that the growing crunch in health care coverage and unabated premium increases would create demand for new approaches.
“This is a terrific outcome for all the parties involved,” said Dan Janney, Managing Director at Alta Partners and Definity Health Corporation board member. “Tony Miller, Definity CEO, and his team had the foresight to develop a novel model for healthcare delivery and created the fastest growing health plan in America becoming a leader in consumer driven healthcare. With the strength of United Healthcare behind the team, they should continue to dominate this growing area.”
Definity is currently profitable with projected revenue of approximately $100 million in 2005. The Company estimates that in January 2005, it will serve some 500,000 consumers in all 50 states who will benefit from the additional support and network of UnitedHealth Group.
The Thomson Venture Economics and National Venture Capital Association numbers summarizing mergers and acquisition activity in the third quarter of 2004 showed gradual improvement in venture capital exit markets with disclosed valuations 44% higher than during the same period in 2003. Definity is part of a continuing trend where 79% of companies acquired in 2004 received their first round of venture financing prior to 2001.
About Alta Partners:
Alta Partners is a venture capital firm founded in 1996, which currently manages seven venture fund programs aggregating approximately $1.5 billion in committed capital. Alta has funded approximately 120 life sciences and information technology companies to date. Additional information is available at http://www.altapartners.com/.
About Definity Health:
Definity Health provides health benefits to nearly 100 employers, including 24 of the Fortune 500, under self-funded benefit plan arrangements. A privately-held leading provider of consumer-driven health benefit programs, Definity was founded in Minneapolis, Minnesota in 1998. Additional information is available at http://www.definityhealth.com/.
Alta Partners
CONTACT: Melita Wenger of Alta Partners, +1-415-782-4042
Web site: http://www.definityhealth.com/
Web site: http://www.altapartners.com/