Cognosante divests consulting arm to NTT Data Services

Health care IT contractor Cognosante has divested its consulting division in a move partly intended to mitigate organizational conflicts of interest with its core business centered around technology solutions.

The buyer is NTT Data’s services business and they add new work in IT strategy, planning, quality assurance and project management for state health care agencies that are transforming the IT and business systems supporting Medicaid and related programs, both companies said in a release.

Cognosante Consulting touts almost three decades of experience in working with 48 states and federal agencies on developing, managing, and executing large, complex health IT implementations.

NTT Data Services said it gains more than 250 specialized consulting resources and intellectual property that supports IT transformations, which includes those specific to Medicaid in more than 20 states.

In a release, Cognosante founder and CEO Michele Kang credited the consulting business with growth in revenue and number of employees by almost 500 percent since 2010.

“This growth of scope and reach, however, began to create conflicts with Cognosante’s core business, requiring us to look for divestiture opportunities,” Kang said her statement. “We could not have found a more perfect home than NTT Data Services to align with Cognosante Consulting’s overall mission and company culture.”

Stone Key Group was Cognosante’s exclusive financial adviser on the transaction.

WT has requested more information from NTT Data about the consulting business and will update this story if and when we hear back.