Daou woos Perot Systems in hopes of potential buyout

Daou woos Perot Systems in hopes of potential buyout

Healthcare information systems company and application service provider Daou Systems is hoping to join forces with Perot Systems and is currently negotiating a potential buyout. According to the San Diego, CA-based firm, the purchase price being discussed is not a premium over its market price. Despite the ongoing talks, Daou’s stock price dropped over 20% to $2.19/share on August 11 from a closing price of $2.75/share on August 9, following the company’s poor second quarter earnings report.

Daou reported a net loss of $2.8 million, or 16¢ per share, on revenue of $16.1 million for second quarter 2000, compared to net income of $60,000 on revenue of $27 million for second quarter 1999. The company blames its lower-than-expected earnings on lagging demand for healthcare IT services due to continued effects of Y2K and the Balanced Budget Act, managed-care cost pressures, slow demand for HIPAA-related services, and uncertainties surrounding healthcare integration.

In related news, Perot Systems has closed a strategic agreement to provide infrastructure design and implementation and operational support systems to Tellaire, a telecommunications provider of laser-based broadband communications. This partnership will further the Dallas firm’s reach in wireless broadband.

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