In perhaps the largest acquisition of a digital health company, One Equity Partners, the private investment arm of JP Morgan Chase, will acquire M*Modal for $1.1 Billion and take the company private.

M*Modal (@MModal) is currently listed on the NASDAQ under the symbol MODL. The Franklin, TN-based company employs 12,000 people in five countries and owns 140 patents for its various technologies.

The company’s two core “families” of products are M*Modal Fluency (MMF) and M*Modal Catalyst (MMC).

According to their website, 80-90 percent of the information captured at the point of care is unstructured spoken word. The MMF products are designed to convey speech into text and text into “context” for the purpose of streamlining the health care process. The MMC product suite is designed to provide valuable insights into the narrative captured by MMF to empower those charged with quality control, performance improvement, and enhancing patient care to work “smarter”.

I doubt the bankers were hanging on the news coming out of Washington, DC recently as the Supreme Court ruled on Obamacare, but the decision to uphold Obamacare will certainly be a catalyst for the immediate growth in M*Modal’s future.  Hospitals will aggressively ramp up their adoption of clinical transcription software to ease the transition to the new reimbursement model, which will demand data on quality of care from providers before they can expect to receive any reimbursement from payers.

The $14/share tender represents a 33-percent premium on the 52-week volume weighted average closing price for the stock, which means One Equity sees significant growth in M*Modal’s future and was willing to pay up to work its magic to improve the company’s management and operations as it tackles the challenges around scalability and performance. These are essentially the by-product of success.

“M*Modal continues to reach major milestones in technological innovation, product leadership and customer successes”, noted Vern Davenport, Chairman and CEO of M*Modal. “One Equity Partners matches our passion and drive, and we believe will be the right financial partner to accelerate our strategic goals and further enhance our leadership position as the entire industry focuses on improving the cost and quality of care. Our focus is, and will continue to be, on serving customers through our clinical documentation services and Speech Understanding™ solutions that unlock value from the ‘unstructured’ clinical narrative.”

“M*Modal presents a unique opportunity to acquire a market leader in clinical documentation at a time when the company has successfully released its new generation of speech understanding solutions for healthcare,” said Dick Cashin, Managing Partner of One Equity Partners. “We will support M*Modal’s outstanding management team to invest in and build on M*Modal’s reputation for technical innovation and quality products and services as the company ramps up its delivery of powerful new solutions to enhance the processing and understanding of healthcare information.”