SHPS to sell its Human Resource Solutions subsidiary to ADPMarch 08, 2012
SHPS, Inc., ("SHPS") one of the country’s largest independent providers of benefits administration, health and wellness services, and collaborative care software has entered into a definitive agreement to sell SHPS Human Resource Solutions, Inc., a wholly owned subsidiary of SHPS, Inc. to ADP, a leading provider of human resource outsourcing, payroll services, and benefits administration, based in Roseland, New Jersey. Terms were not disclosed. "ADP will be acquiring a leading business with a strong portfolio of clients coupled with mature service capabilities that include eligibility and enrollment, health spending accounts, COBRA administration, absence management, benefits advocacy and fulfillment," said Rishabh Mehrotra, President and CEO of SHPS, Inc. "The business to be acquired includes proprietary platforms for administering health spending accounts and total absence management that provide employers of all sizes with more options and unprecedented flexibility." SHPS’ other businesses, Carewise Health and Landacorp, will remain intact as wholly owned subsidiaries of SHPS, Inc. "This strategic move allows us to focus 100% of our business on healthcare, at a time when a rapidly changing marketplace has greater opportunities than ever before," said Mehrotra. "Carewise Health, whose industry-leading health and wellness programs help organizations improve the personal health of employees and control healthcare costs, and Landacorp, a leading provider of collaborative care software, are well-positioned in the emerging market place. "Historically, Carewise Health has provided comprehensive care management services for large employers and other third-party payers. "As care services begin to realign around physicians—particularly in the areas of medical home and accountable care organizations—we will be in a better position to target each market segment more directly and cost-effectively," added Mehrotra. Mehrotra will remain president and CEO of SHPS and, with the exception of certain executives, the current leadership team will remain in place. Almost fifty percent of SHPS employees, 840 people, will become employees of ADP upon closing of the transaction. Of the 840 people who join ADP, 650 will work out of the remaining SHPS’ Louisville offices, expanding ADP’s local workforce, which is currently 350 people. SHPS leadership does not anticipate changes to staffing levels during this time. "As a service organization, continuity of service to all clients remains our top priority," said Mehrotra. "Because growth is a primary objective of this deal, it may lead to the creation of new jobs over time."