Big Company May Sell Healthcare Software Firm for $5 Billion

A large investment firm called TPG is trying to sell a healthcare software company named Lyric. The sale could be worth around $5 billion. Lyric makes software that helps big health insurance companies catch and stop wrong payments on medical bills. People close to the talks shared this information in early September.

TPG is working with bankers at JPMorgan Chase to find a buyer for Lyric. However, the people who shared this information warned that there is no guarantee a sale will actually happen. They also asked not to be named because the talks are private. Lyric earns about $250 million a year before certain costs are subtracted, and that number helps set its price tag of roughly $5 billion.

The story of Lyric goes back a few years. TPG bought a company called ClaimsXten in 2022 for about $2.2 billion. That company was originally part of a bigger healthcare business called Change Healthcare, but it was sold off to help avoid legal problems when UnitedHealth was trying to buy Change Healthcare for $13 billion. TPG later gave the company a new name — Lyric.

Since the rebrand, TPG says Lyric has grown much faster. The firm says Lyric has benefited from using artificial intelligence, which is technology that lets computers learn and solve problems on their own. Because Lyric has a lot of useful data, TPG believes AI can make the company even stronger over time.

Still, not everyone is sure that companies like Lyric are safe from change. Some possible buyers are wondering if newer AI-powered companies could do the same work for less money. That worry could make it harder to agree on how much Lyric is truly worth. This kind of uncertainty is affecting many software companies right now.

One example of that uncertainty is a smaller company called Claritev. Its stock price dropped 80 percent between September 2024 and May of this year because investors were worried about AI hurting software businesses. Even though its stock has bounced back a little, it is still trading well below where it was a year ago. This shows how nervous the market is about AI's effect on companies like Lyric.