This is technology M&A deal number 755 that ChannelE2E has covered so far in 2021. See all technology M&A deals for 2021 and 2020 listed here.
CNSI, based in Greenwich, Connecticut, provides healthcare technology solutions to government agencies at the state and federal levels.
The company develops, implements, operates and maintains mission-critical systems for Medicaid, Medicare and related health programs. Its programs have been used by the Department of Veterans Affairs, Department of Labor and the Centers for Medicare & Medicaid Services. The company reports about $200 million in annual revenue.
Todd Stottlemyer, who became CEO of CNSI in 2018, will continue to lead the company. Stottlemyer has previously partnered with Carlyle as a senior executive at BDM International.
Carlyle Acquires CNSI: A “Unique Intersection”
Todd Stottlemyer, CEO, CNSI, commented on the deal:
“We are delighted about this opportunity to partner with Carlyle as we continue to execute exquisitely for our clients, strengthen our market leading products and solutions, and drive innovation that improves health outcomes and lowers costs. Carlyle is a first-class organization, and I know from my previous experience working with them that they truly partner with their portfolio companies to help them achieve their vision and strategic growth objectives.”
Dayne Baird, managing director, Carlyle, said:
“We are very excited to partner with Todd Stottlemyer and the CNSI management team. We believe CNSI is well-positioned for continued success driven by its technical leadership and proven track record of innovation and execution. CNSI operates at the unique intersection of technology, healthcare and government services, and we see significant growth opportunities ahead as the company leverages its unique capabilities and continues to develop market-leading solutions.”
Alex Nivelle, partner, Alvarez & Marsal Capital Partners, added:
“It has been a fantastic partnership with the CNSI management team. Throughout our four-year investment, the team successfully leveraged CNSI’s market leading technology solutions to build a highly scalable platform for growth in the healthcare technology marketplace. We look forward to the team’s continued success as they begin their next phase of growth in partnership with Carlyle.”
Baird acted as the exclusive financial advisor to CNSI in connection with the transaction. Kirkland & Ellis LLP acted as legal advisor to CNSI. Latham & Watkins LLP acted as legal advisor to Carlyle.
The Carlyle Group’s IT Solutions Experience
This isn’t the private equity firm’s first foray into the IT services provider space. In February 2021, the company acquired IST Research and Two Six Labs and merged them into one entity. In September, the company was reported to be buying Hexaware Technologies for $3 billion, in direct competition with KKR, Bain Capital, and Teleperformance SE.