Tyler Technologies has purchased Charlotte, N.C.-based Digital Health Department (DHD), a solution provider specializing in environmental health and compliance-related software used by state and local governments, in a deal completed Wednesday morning.
The Plano, Texas-based company – No. 44 on the CRN Solution Provider 500 – sought to acquire DHD after identifying environmental health as a gap within EnerGov, Tyler's enterprise licensing and regulatory solution. By adding DHD's inspection support capabilities, which include health and environmental compliance, food safety, drinking water, wastewater and septic permits, Tyler said it would be able to provide government agencies with a more complete and robust solution.
Tyler will also continue to pursue standalone environment health solutions, an area of interest for DHD's client base.
"The strategic play should improve our win rates," said Rusty Smith, general manager of Tyler's EnerGov solution. "We believe it allows us to sell more logos, and it falls in line with the general trend of transparency the public demands from the government, with safety becoming more important."
Financial terms of the deal were not disclosed.
DHD and all of its current employees will be absorbed into Tyler's public health division, the scope of which includes community development, licensing, regulatory and community health practices.
Smith estimated a 10 to 15 percent client base overlap between the two companies, with the potential for some compelling cross-selling opportunities to arise soon.
"We have some really great feedback from the market, from existing mutual clients to clients that are aware of Tyler and our other products," Smith said. "And they're already interested in talking more about how we see these products fitting together so they can expand their footprint with us."
The DHD deal is Tyler's fifth acquisition since May 2015, over which time it has purchased $10 million solution provider Brazos Technology Corp., scheduling software provider ExecuTime and public safety software specialist New World Systems, the latter being bought for $670 million.
Moving forward, Tyler said it would remain "disciplined" in its M&A strategy and continue to look for opportunities to bolster each of its flagship areas.
"This opportunity with Tyler is a natural fit for our company and will help us accelerate the offerings we currently provide in the environmental health market," DHD CEO Rahul Saxena said in a statement. "Health inspections are becoming increasingly important to government agencies, and we're looking forward to being able to provide our existing and prospective clients the option to further enhance their enterprise permitting and licensing needs through Tyler's solutions."