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Athenahealth Shares Explode Higher on Latest Elliott Management Bid

The insurgent fund managed by Paul Singer wants to buy the health tech company for $6.9 billion, but its large minority stake suggests that the fund would not be disappointed if a White Knight buyer emerged.

One year after launching a campaign urging Athenahealth Inc. (ATHN) - Get athenahealth, Inc. Report to consider "strategic options," $35 billion activist investor Elliott Management on Monday launched a hostile bid to buy the healthcare technology company for as much as $6.9 billion including debt, in an all-cash offer.

Athenahealth shares rose 16%, or $19.93 cents to $146.02.

The bid, for $160 a share, may be the latest example of Elliott Management shifting from its bread-and-butter activist activists into the world of private equity, following its move recently to set up a Menlo Park, Calif.-based private equity team, Evergreen Coast Capital Partners.

The activist investor has had a great deal of success over the years driving companies to sell themselves or take other M&A actions. In many cases, activists will make hostile bids in the hopes of encouraging other friendly bidders, often known as White Knights, into making bids and striking deals at a premium. For example, Elliott made a bid to buy Lifelock in 2016, after acquiring an 8.4% stake, and it later sold to Symantec.

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