The Company is a leading provider of chronic care management services directed to self-insured employers. Unlike most other participants in this segment which subcontract their services to health insurers, this company contracts directly with large (5,000 or more employees), often unionized employers that recognize their need to get control over rapidly escalating health care costs. By contracting directly with the employer, the company can provide the same services to all employees regardless of the location in which they work. In addition, the company uses an opt-in model that puts the employee in control of the decision to seek help to combat the chronic illness with which they or a dependent must contend. This tightly controls the employer’s expense, and allows them to make their investment where it is most likely to generate a positive return.

The company engaged TripleTree to assess their strategic options to maximize shareholder value in the short and long-term. The Company is a wholly owned, for-profit subsidiary of a large, not-for-profit system in an unrelated business. The parent has significant capital spending needs in the next few years and the potential for a meaningful liquidity event could help provide flexibility in addressing. Key questions TripleTree sought to answer include:

	What are the key variables that will drive the future valuation for the Company – qualitative and quantitative?
	What are the key liquidity alternatives and what factors might impact the choice between these options?
	What steps must the company take to position itself for maximum value over the next year?
	What is the right way and the right time to actively consider splitting from the parent company to maximize value?

TripleTree demonstrated that the Company is extremely well positioned in a market in which participants from a number of complimentary markets are beginning to actively evaluate. As part of the evaluation process, TripleTree leveraged its knowledge of healthcare to create a market map that demonstrated the reach of chronic care. From this, TripleTree engaged several discussions with organizations around the direct and indirect impact to their existing care services and the value in extending their current business model. The result showed strong interest and the potential for achieving a premium valuation in the near-term far outweighed the benefit of allowing the company to continue its strong internal growth. In seeking to maximize the value of the business and take advantage of the opportunity as a first mover, the parent has begun to take steps to sell the business during the first half of 2004.

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