Less than a year after ending his 16-year tenure at the helm of General Electric (GE), Jeff Immelt has been named chairman of Watertown, Massachusetts-based technology company Athenahealth, which cited his experience in expanding GE Healthcare and a “deep understanding of system economics and patient outcomes” after leading such a large payer of health benefits.
“Having considered a number of highly qualified candidates, the Board determined that Jeff’s deep expertise and broad relationships in the healthcare industry, combined with his drive for industry transformation through innovation, ideally position him to be a great partner to the Board and management team as we work to profitably grow and scale the Company and drive value creation,” Dev Ittycheria, chair of the board’s nominating committee, said in a press release.
Athenahealth said Immelt will make a financial investment in the company, purchasing approximately $1 million of its stock in the open market.
“Athenahealth has great potential to drive the next wave of disruptive change across the healthcare industry, particularly among medical practices, hospitals, and health systems that are challenged by administrative burden and data silos,” Immelt said in a statement. “I look forward to lending my perspectives and expertise to support (CEO Jonathan Bush), the board and the Athenahealth team in Athenahealth’s own journey to grow and scale.”
Immelt will be joining a company worth around $5.4 billion—around 4 percent of GE’s market value, according to Bloomberg—which after once being touted as the “Amazon of healthcare” is being threatened by an activist investor after several years of slow sales growth. Hedge fund manager Paul Singer of Elliott Management disclosed a 9.2 percent stake in Athenahealth in May 2018, calling the company “significantly undervalued” and indicating he would push for changes in operation up to and including selling the company.
Athenahealth responded by cutting 9 percent of its workforce and announcing it would split the roles of CEO, chairman and president which had been held by Bush, one of the founders of the company.