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Nearbuy and Little Internet merge, Paytm gets majority stake

BENGALURU:Discoveryand deals platforms Nearbuy and Little Internet have merged, and financial services platform Paytm has taken a majority stake in this combined entity, the company announced on Wednesday. The merged entity, is expected to be valued at about $100 million with a fresh capital infusion of $25 million by Paytm, according to a source briefed on the matter.

Nearbuy-Little combined is expected to be spearheaded by Nearbuy’s chief executive Ankur Warikoo, said the person cited above.

While the two brands will continue to exist independently, Little Internet founders Manish Chopra and Satish Mani would be moving on. Sequoia Capital, along with other investors of Nearbuy will continue to be shareholders of the merged entity.

“In the local commerce space, Little Internet and Nearbuy combined will own 88% of the market share,” said Warikoo, Nearbuy’s CEO without commenting on specifics of the transaction. “There are around half-a-million merchants in the organised retail space, which we would like to bring on our platform.”

ad028_merge Nearbuy and Little Internet merge, Paytm gets majority stake

This merger brings the total merchants’ count to over 40,000, as the companies look to expand that number to 100,000 by 2018-end. Customers would be able to access Nearbuy and Little Internet deals from the Paytm app as well once it’s integrated on the platform in the next month or two, added Warikoo.

This transaction comes as Paytm looks to boost its position in the offline space allowing its merchants to have the option of acquiring more customers by offering deals and discounts. In July, the payments company acquired a majority stake in online ticketing and events platform Insider.in, thereby allowing Paytm customers to access events listed on Insider.

“Paytm’s goal is to provide its base of over five million merchants, tools to expand their business and to offer its customers the opportunity to buy all categories of digital and physical goods,” said Vijay Shekhar Sharma, CEO, Paytm. Nearbuy (formerly Groupon India) parted from its parent Groupon in 2015. It was later rebranded as Nearbuy when Sequoia Capital pumped in $20 million.

Aurora, Health Care, Advocate Health Care to merge

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Aurora Health Care and Advocate Health Care to merge

Aurora Health Care, the largest health system in Wisconsin, and Advocate Health Care Network, the largest health system in Illinois, announced an agreement on Monday to combine their operations, a merger that would create the 10th-largest nonprofit health system in the country.

The combined system would have annual revenue of $11 billion, employ almost 70,000 people, including more than 3,300 physicians, and operate 27 hospitals.

Its operations would run from Bloomington, Ill., to Marinette.

a1268_biz-fb Aurora Health Care and Advocate Health Care to mergea1268_biz-fb Aurora Health Care and Advocate Health Care to merge

The combined system would be named Advocate Aurora Health and have a single board, with an equal number of directors from Advocate and Aurora. Each system will continue to use its current name and maintain its current headquarters.

The planned merger, which must be approved by state and federal regulators, is expected to close by the middle of next year.

It is a sign that the wave of mergers among health systems throughout the country is moving toward creating regional systems with large geographic footprints.

Aurora and Advocate are betting that size will result in additional financial strength and stability as well as economies of scale for providing increasingly complex care to patients, such as treatments based on patients’ genetic makeup.

The potential advantages from size also include making full use of the advances in information technology, such as analytics, to manage the care of patients.

“We don’t think status quo is the solution in health care,” said Jim Skogsbergh, president and chief executive officer of Advocate. “We think change is needed.”

But Aurora and Advocate will have the challenge of integrating two large organizations, and the proposed merger also is not without risks.

“Just because you get bigger doesn’t mean you are going to getting better,” said Martin Arrick, an analyst with SP Global Ratings.

The planned merger was announced roughly eight months after Advocate and NorthShore University HealthSystem abandoned their planned merger.

The Federal Trade Commission challenged that merger, and a U.S. District Court in March granted the FTC’s request for a temporary restraining order and preliminary injunction blocking the merger.

Nick Turkal, a physician and president and chief executive officer of Aurora, called Skogsbergh shortly after the FTC blocked Advocate’s proposed merger with NorthShore.

“It just made sense to talk about coming together,” Turkal said. “It was an easy discussion to start.”

The two health systems share ownership of ACL Laboratories, and Skogsbergh said he had raised the idea of combining the two systems four or five years earlier.

Unlike the planned merger with NorthShore, which is headquartered in Evanston, Ill., the proposed merger of Aurora and Advocate would not lessen competition in their markets and is unlikely to be challenged by the FTC or state regulators.

Both health systems are nonprofit organizations and, unlike corporate mergers, no money will change hands.

Skogsbergh and Turkal will be co-CEOs — an organizational structure that generally hasn’t worked.

Neither of them is naïve about the challenges in having two CEOs, Skogsbergh said, but the structure has worked at some corporations and organizations.

“We believe that if anyone can pull this off, we can,” he said.

The two will share some duties and divide others.

“The conclusion we came to is there is plenty of work for both of us,” Turkal said.

Having co-CEOs also could counter the perception among employees that one system is taking over the other.

Turkal is 61 years old, and Skogsbergh is 59. Integrating the two systems will take years, and both executives could be near retirement by the time it’s done, clearing the way for the board to select someone to be chief executive of the combined health system.

Turkal stressed that no jobs would be eliminated because of the merger.

“We need everybody we have,” he said.

The merger could create jobs, he said, as the combined health system increases its presence in the Wisconsin and Illinois counties expected to grow from Foxconn Technology Group’s planned $13 billion plant in Racine County.

There is no firm deadline for the health system integration, Skogsbergh said, and the combined system will have the luxury of taking its time.

“Both organizations are in a position of strength,” he said. “There is no panic.”

Aurora and Advocate each are strong financially.

From the start of 2015 through the first nine months of this year, they have reported a combined total of $1.8 billion in operating profits and $2.5 billion in net profits, including investment gains on their reserves and other income.

Advocate has less debt and generated more income from its investments than Aurora has in recent years. However, Aurora has much higher operating profit margins than Advocate.

In May, Advocate announced plans to reduce its operating costs by approximately $185 million, citing the drop in its operating profit margins.

Aurora and Advocate made no promises that the merger would yield a set amount of cost savings.

Negotiating power

Studies have shown that health system mergers have led to higher prices for medical services by giving the combined systems more leverage when negotiating with health insurers.

There is little overlap in Advocate’s and Aurora’s markets. But a large regional health system still could have more sway when negotiating contracts.

“It definitely gives you more leverage,” said Lisa Phillips, editor of HealthCareMandA.com, owned by Irving Levin Associates.

But Robert Town, an economics professor at the University of Texas-Austin, said that the net effect of the mergers has varied.

“Some are not good for consumers, and some are great for consumers,” said Town, who has studied consolidation among health systems and hospitals.

Advocate has been at the forefront of negotiating contracts with health insurers that change the way the health system is paid, moving away from so-called fee-for-service toward receiving a fixed amount for providing care for patients.

The new contracts enable the health system to share in the savings if it can provide care at a lower cost while meeting quality targets — but also put it at risk of losing money if it can’t.

As of Sept. 30, 21% of Advocate’s operating revenue came from the contracts, according to its most recent financial statement.

Cost controls

Advocate also has shown impressive results in providing care at a lower cost in a Medicare program that provides the same incentives.

Aurora, too, has moved to control costs since Turkal became chief executive officer in 2006.

The operating costs of Aurora hospitals in southeastern Wisconsin increased by only 2% from 2003 to 2015, according to a study done by Milliman Inc., a consulting firm, for the Greater Milwaukee Business Foundation on Health. In 2003, they were the highest in the region.

Hospital care accounts for 30% to 35% of commercial health plans’ total costs.

At the same time, Aurora’s profits have increased significantly, and it has paid down debt.

But the planned merger of Aurora and Advocate is certain to bring challenges. The merger will result in a larger, more complex organization. And controlling costs and improving quality is a difficult and painstaking task for much smaller health systems.

“It may take 10 years for the benefits to fully materialize — and they may not at all,” Town said. “There a lot of uncertainty.”

One clear challenge is Aurora’s system for electronic health records uses software from Epic Systems in Verona, while Advocate’s system uses software from Cerner and Allscripts.

To integrate the two health systems in all likelihood will require moving to one system for electronic health records, a task that would take years and potentially cost hundreds of millions of dollars.

Changes in how health care is delivered and the pressure to slow the rise in health care spending will be other challenges.

More than half of all procedures now don’t require a hospital stay, cutting into health systems’ revenues. And health insurers are increasingly balking at paying higher hospital prices for services that can be provided in less costly settings.

For example, Anthem this year said it would no longer cover MRI and CT scans done at a hospital unless medically necessary.

High-deductible health plans have led to more bad debt. The ongoing efforts to repeal the Affordable Care Act could result in more people being uninsured. And most economists expected the proposed tax cut now likely to become law to increase future budget deficits, resulting in more pressure to spend less money on Medicare.

Advocate operates in a large but competitive market and competes with academic medical centers affiliated with the University of Chicago, Northwestern University and other schools.

Advocate also operates in a state in dire financial straits because of unfunded pension obligations — a situation that does not bode well for spending on that state’s Medicaid programs.

Medicaid programs account for 16% of Advocate’s revenue, and the state of Illinois has routinely not paid Medicaid claims on a timely basis.

Merger momentum

But health systems throughout the country are betting that size will help them navigate these and other changes expected in the industry.

Since the start of 2014 through Nov. 30, there have been 337 health system or hospital mergers or acquisitions in the United States, according to Irving Levin Associates.

The trend can be seen in Wisconsin.

Ascension, the parent of Columbia St. Mary’s, is now the second-largest system in Wisconsin, having merged with the parent of Ministry Health in 2013 and adding Wheaton Franciscan Healthcare’s operations southeastern Wisconsin to its system last year.

United Hospital System in Kenosha is now affiliated with Froedtert Health and the Medical College of Wisconsin.

And in recent years, Meriter Health Services in Madison merged with UnityPoint Health, SwedishAmerican Health System in Rockford merged with UW Health, and Rockford Health System merged with Mercy Health System in Janesville.

That’s just a sampling.

Although the pace has quickened in recent years, the trend is not new.

Aurora’s roots go back to the merger of St. Luke’s Medical Center and Good Samaritan Medical Center in 1984.

But what started with cross-town mergers has evolved into regional combinations. And the proposed merger of Aurora and Advocate dwarfs any of the recent mergers in Wisconsin.

The merger would give the new entity — Advocate Aurora Health — national prominence. Whether it results in a health system that can slow the rise in health care costs and improve the quality of care won’t be known for years.

Aurora and Advocate clearly are betting that it will.

“The final thing I would say,” Turkal said, “is just watch us.”

Advocate Health Care Network

Headquarters: Downers Grove, Ill.

Hospitals: 12, including a children’s hospital

Clinics and other sites of care: 450

Employees: 36,000*

Revenue: 2016: $5.6 billion

Operating income (2016): $263.6 million

Net income (2016): $597.6 million

* As of Sept. 30.

Source: Advocate Health Care’s financial statements 

Aurora Health Care

Headquarters: Milwaukee

Hospitals: 15, including a psychiatric hospital

Employees: 33,000*

Revenue: 2016: $5.1 billion

Operating income (2016): $373.3 million

Net income (2016): $469.1 million

* As of Dec. 31, 2016.

Source: Aurora Health Care’s financial statements

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VA, Pentagon explore health system merge

Also: VA can share dependents’ opioid use

President Donald Trump this week signed legislation introduced by Sen. Joe Donnelly, D-Ind., and three other members of Congress thatallows the Department of Veterans Affairs to share data on opioid prescriptions for veterans and their dependents with state prescription drug monitoring programs.

VA had been sharing opioid prescription data for veterans but not their dependents.

The U.S. Department of Veterans Affairs said Wednesday that any consideration ofblendingVA and Department of Defense health careprograms wouldnotendanger VA’s network of clinics and hospitals.

“This has nothing to do with VA health care delivery system reform,” James Hutton, deputy assistant secretary for VA public and intergovernmental affairs, said in an email.

The Associated Press reported Friday thatVA and the Pentagon areexploringthe possibility of mergingtheir health care systemsand that veterans advocacy groups feared a mergercouldthreaten the viability of VA medical facilities.

Active-duty military personnel see private medical providers who are paidby the Defense Departmentmedical insurance planknown as TRICARE. VAoperates more than 1,200 medical facilities for military veterans – including a medical center and an outpatient clinic in Fort Wayne– and its Veterans Choice Program pays for private care providersif veterans livemore than 40 miles away from a VA clinic or have to wait at least 30 days for an appointment with a VA physician.

“We are simply exploring in preliminary terms the general concept of partnering between the VA and DoD health care systems to provide better care for Veterans at lower costs to taxpayers,” Hutton said in his email.

“One example is looking at ways to partner by sharing provider networks and, potentially, services like credentialing and claims processing,” he said.

Huttoncalled “false” any premisethat a VA-Pentagon health care combinationwould result in a huge expansion of TRICARE and the shutdown of VA medical facilities. He referred The Journal Gazette to a comment made Tuesday on Twitter by VA Secretary David Shulkin, who wrote:“Those pushing the’privatization’theory don’t have it right. I’ve said repeatedly that won’t happen on my watch.”

Hutton referenced another remark by Shulkin:“If there are efforts where we could do things better, we want to look at all those ideas and the potential synergies. But there is no plan here. There is no draft. We are simply having early discussions.”

House Minority Leader Nancy Pelosi, D-Calif., had told The Associated Press that the merger talk was “evidence thatthe Trump administration is quietly planning to dismantle veterans’ health care.”Pelosi saidHouse Democrats “will fight tooth and nail against any efforts to diminish or destroyVA’s irreplaceable role as the chief coordinator, advocate and manager of care for veterans,” according to the news organization.

The AP reported that four of the nation’s largest veterans advocacy organizations– the American Legion, Veterans of Foreign Wars, AMVETS and Disabled American Veterans –indicated they would oppose any attempt to transform VA medical care into an insurance plan.

Federal lawmakers representing northeast Indiana neither endorsed nor rejected the idea of possibly merging military and veterans health care systems.

Rep. Jim Banks, R-3rd,said in astatement to The Journal Gazette that as a member of the House Veterans Affairs’ Committee he “is committed” to existing bipartisan legislation designed to improve VA’s Choice Program.

“I look forward to continued discussions on how we can provide the best care for our nation’s veterans,” Banks said.

Sen. Joe Donnelly, D-Ind., said in astatement that “if the VA is exploring a merger of the Choice program with the Department of Defense’s TRICARE program then the VA should share details of that plan, so that Congress and the public can carefully review it before taking action.”

Jay Kenworthy, communications director for Sen. Todd Young, R-Ind., said in an email, “As the issue is discussed, Senator Young will continue to advocate for Hoosier veterans.”

Rep. Jackie Walorski, R-2nd, said in astatement, “I look forward to reviewing any proposals to fix the VA and working with my colleagues, the administration, and veterans service organizations to ensure all our veterans get the care they earned.”

The VA Northern Indiana Health Care Systemserves 45,000 veterans and employs 1,879 at medical centers in Fort Wayne and Marion and clinics in Fort Wayne, Goshen, Mishawaka, South Bend, Peru and Muncie.

bfrancisco@jg.net

Coding and Maker Nonprofits Merge, Expanding Influence in the …

Today Code/Interactive, a New York City-based nonprofit known for their work training coders and teacher professional development, announced its merger with another New York City nonprofit, Mouse, a youth technology and engineering organization, popular for its middle school makerspaces.

Code/Interactive, valued at approximately $1.5 million, offers Mouse, currently valued at about $2.5 million, a financially viable and operationally sound partnership, says Daniel Rabuzzi, Mouse’s executive director.

In an interview with EdSurge, Rabuzzi and Tom O’Connell, the interim executive director of Code/Interactive, explained how their merger would allow them to expand their offerings—combining the core concepts behind coding and making with hopes to scale creative computing throughout K-12 schools across the nation.

“Creative computing or creative technology is the future of pretty much every classroom, not only computer science classrooms,” O’Connell says. “So we’re bringing in learning content from Mouse and educator training from the Code Interactive to open opportunities for all of us to engage with creative technology and computer science.”

The announcement is timely, coming after a $200 million-dollar grant announcement from the White House for computer science education, matched by another $300 million-dollar grant from private technology companies. Both Rabuzzi and O’Connell hope that this merger will put them in position to receive some of this funding and scale their operations, moving them from mid-sized to a large scale nonprofit.

“All of a sudden through state action and governors announcing big projects, computer science is something schools need to train their teachers for. So I think we’re all waking up to this as a huge opportunity to expand our our our influence across the country and serve the needs of schools in a deep way,” says O’Connell. “We’d be way more able to manage operations, finance mechanisms, DOE grants or some of these larger opportunities as a merged entity.”

O’Connell also hopes that Mouse and Code/Interactive will be able to offer their users a few things they couldn’t give in the past. For example, O’Connell notes that his team did not have the bandwidth to provide users with artificial intelligence curricula for chatbots. After the Mouse merger, though, they hope to do just that. In addition, Mouse’s work primarily rested in the middle and high school space, while Code/Interactive focused on high school. The organizations look to scale their offerings from kindergarten to twelfth grade after the merger.

However, O’Connell notes the overall complexity of nonprofit mergers, saying the final consolidation is still tentative as the organizations await regulatory approval from the state attorney general. 

Coding and Maker Nonprofits Merge, Expanding Influence in the Computer Science Space

Today Code/Interactive, a New York City-based nonprofit known for their work training coders and teacher professional development, announced its merger with another New York City nonprofit, Mouse, a youth technology and engineering organization, popular for its middle school makerspaces.

Code/Interactive, valued at approximately $1.5 million, offers Mouse, currently valued at about $2.5 million, a financially viable and operationally sound partnership, says Daniel Rabuzzi, Mouse’s executive director.

In an interview with EdSurge, Rabuzzi and Tom O’Connell, the interim executive director of Code/Interactive, explained how their merger would allow them to expand their offerings—combining the core concepts behind coding and making with hopes to scale creative computing throughout K-12 schools across the nation.

“Creative computing or creative technology is the future of pretty much every classroom, not only computer science classrooms,” O’Connell says. “So we’re bringing in learning content from Mouse and educator training from the Code Interactive to open opportunities for all of us to engage with creative technology and computer science.”

The announcement is timely, coming after a $200 million-dollar grant announcement from the White House for computer science education, matched by another $300 million-dollar grant from private technology companies. Both Rabuzzi and O’Connell hope that this merger will put them in position to receive some of this funding and scale their operations, moving them from mid-sized to a large scale nonprofit.

“All of a sudden through state action and governors announcing big projects, computer science is something schools need to train their teachers for. So I think we’re all waking up to this as a huge opportunity to expand our our our influence across the country and serve the needs of schools in a deep way,” says O’Connell. “We’d be way more able to manage operations, finance mechanisms, DOE grants or some of these larger opportunities as a merged entity.”

O’Connell also hopes that Mouse and Code/Interactive will be able to offer their users a few things they couldn’t give in the past. For example, O’Connell notes that his team did not have the bandwidth to provide users with artificial intelligence curricula for chatbots. After the Mouse merger, though, they hope to do just that. In addition, Mouse’s work primarily rested in the middle school space, while Code/Interactive focused on high school. The organizations look to scale their offerings from kindergarten to twelfth grade after the merger.

However, O’Connell notes the overall complexity of nonprofit mergers, saying the final consolidation is still tentative as the organizations await regulatory approval from the state attorney general. 

BRIEF-GMO Internet to merge with units

Oct 23 (Reuters) – GMO Internet Inc

* Says it will merge with three units, GMO Gamepot Inc., Syncloud, Inc and Tokyo-based mobile entertainment firm, effective Dec. 1

* Says three units will be dissolved after merger

Source text in Japanese:goo.gl/YCzzs3

Further company coverage: (Beijing Headline News)




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