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ByKate Kelly and David Enrich
- June 6, 2018
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A member of one of America’s best-known political families resigned on Wednesday from the health care technology company he started, in a victory for one of the world’s most powerful hedge funds.
Jonathan Bush, a nephew of one president and cousin of another, stepped down as chief executive of Athenahealth. Mr. Bush’s resignation came amid pressure from Elliott Management, a $35 billion hedge fund run by the billionaire investor Paul E. Singer that had made a hostile offer to take over the company.
In announcing Mr. Bush’s departure, Athenahealth said in a statement that it was evaluating its strategic options, including a possible sale. For now, the company said it would be run by Jeff Immelt, the chairman of the Athenahealth board and until last year the chairman and chief executive of General Electric.
In his own statement, Mr. Bush said, “It’s easy for me to see that the very things that made me useful to the company and cause in these past 21 years, are now exactly the things that are in the way.”
Athenahealth shares rose 3.6 percent, to $156.53, in early trading on Wednesday, giving the company a market value of $6.3 billion.
Athenahealth, based in the Boston suburb of Watertown, provides billing and other digital services for 114,000 medical providers and stores more than 110 million patient records. It grew out of a company that Mr. Bush started in 1997.
Mr. Bush, 49, is a nephew of President George H.W. Bush and a cousin of President George W. Bush. His resignation and Athenahealth’s decision to potentially put itself up for sale comes a month after Elliott unveiled its hostile bid. In making the offer, the hedge fund argued that strategic miscues had left the company dramatically undervalued.
Athenahealth initially tried to defend itself against Elliott’s offensive. But pressure mounted as other shareholders, including Janus Henderson and ClearBridge, pushed the company to consider purchase offers. Both Janus and ClearBridge criticized Athenahealth’s management.
As the fight escalated, court papers surfaced indicating that in 2005, Mr. Bush had physically and verbally abused his former wife. News reports about the episode prompted Mr. Bush to publicly apologize last month.
Stephen Spruiell, an Elliott spokesman, praised Athenahealth’s actions.
“We we look forward to participating as a bidder in the company’s strategic exploration process,” he said.
Michael de La Merced contributed reporting.
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