The focus will be on cost savings, quality, and outcomes, by offering health plans and providers “a comprehensive suite of end-to-end financial and payment solutions and technologies.” Future customers will also be aided in the increasingly complex challenges in both administrative and clinical complexity “as they navigate the transition to value-based care,” the companies stressed.

“The innovative track records and forward-thinking experiences of both organizations create a truly unique opportunity for positive impact across the health care ecosystem,” said Neil P. Simpkins, senior managing director of Blackstone.

The deal has McKesson putting all of MTS into the new firm except for RelayHealth Pharmacy and the Enterprise Information Solutions (EIS) division, which it will keep.

McKesson has announced that it will seek “strategic alternatives” for the EIS division.

Change Healthcare will put the entirety of its businesses into the new company except for its pharmacy switch and prescription routing business, which will continue to be owned by current Change stockholders.

McKesson will own approximately 70 percent of the new company, with the rest going to Change stockholders, which include Blackstone and Hellman & Friedman.

Hammergren will become chairman and de Crescenzo will take the helm as CEO.

The new firm is anticipated to generate at least $150 million in annual synergies by year two post-deal.

The new company has commitments for $6.1 billion of funded debt. Of that amount, roughly $2.7 billion will go to pay off existing Change debt, $1.25 billion will be paid in cash to McKesson and $1.75 billion will be used for cash payments to Change stockholders. The rest, about $400 million, will go toward expenses incurred during the transaction.

The transaction is planned to be closed in the first half of calendar year 2017. An IPO is also anticipated shortly after the deal is finalized, depending on market conditions.

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