Waystar Weighs Sale Amidst Software Sector Challenges

Waystar, a healthcare software company known for its payment management solutions for hospitals and doctors, is considering a potential sale. According to seven sources familiar with the situation, the company has engaged investment bank Evercore to explore various strategic options, including a sale that could see Waystar return to private ownership just two years after its New York stock market debut.

The Lehi, Utah, and Louisville, Kentucky-based firm has seen its market value decline to approximately $4.8 billion, following a 24% drop in its share price this year. This decline aligns with a broader downturn in the software sector. The company's decision to explore a sale could be seen as a test of investor interest in software businesses, amid investor concerns about artificial intelligence potentially disrupting the industry.

Investment Bank Evercore to Guide Sale Exploration

Two sources, who requested anonymity due to the confidential nature of the discussions, indicated that Waystar's exploration of options is still in the early stages. They cautioned that plans could change, and a sale might not occur. Evercore, the investment bank advising Waystar, has not commented on the matter.

Waystar's strategic positioning as a technology company, rather than a healthcare services provider, was intended to attract higher valuations typical of tech firms. Initially, this strategy was successful, with shares climbing from $20 to a peak of $45 in 2025. However, the stock has faced pressure as investors worry about the impact of AI advancements on the software industry, as noted by Morgan Stanley analysts in a July report.

Waystar's Origins and Shareholder Structure

Formed in 2017 from the merger of healthcare revenue management companies Zirmed and Navicure, Waystar's primary backers include EQT, the Canada Pension Plan Investment Board (CPPIB), and Bain Capital. These firms took the company public in 2024. EQT remains the largest shareholder, holding a 13% stake, followed by CPPIB with 10%, and BlackRock Institutional Trust Company with 8%, according to data from LSEG.

Despite the current exploration of a sale, neither Waystar nor its major investors, EQT and CPPIB, have provided comments. BlackRock has also declined to comment on the situation.

The outcome of Waystar's strategic review could provide insights into the current appetite for software companies, especially those in the healthcare sector, amidst evolving technological landscapes and market uncertainties.