SOURCE: Canopy Financial

October 15, 2008 07:30 ET

Canopy Financial Announces Acquisition of CareGain

Acquired From Fiserv, Combined Entity Creates Industry Leader in Healthcare Banking Technologies for Financial Institutions and Health Plans

SAN FRANCISCO, CA and CHICAGO, IL--(Marketwire - October 15, 2008) - Canopy Financial, a pioneer in innovative healthcare banking technology solutions that connect healthcare and financial services, today announced it has acquired CareGain, Inc. from Fiserv, Inc. Through the acquisition of CareGain, a market leader in providing consumer-directed healthcare (CDH) account administration and management software to leading health plans, Canopy consolidates the healthcare banking technology market, and is now the market leader in delivering innovative, scalable, account management and electronic payment solutions to leading health plans and financial institutions.

Under the terms of the acquisition, CareGain's clients will now be served by Canopy. The combined entity, which powers the CDH programs of many of the top 25 health plans and financial institutions, today administers over one million CDH related spending accounts nationally. Fiserv retains its healthcare banking solutions for its financial institution clients.

"Today marks a great milestone for our company and the CDH industry in general. This partnership brings together the best minds and technologies and creates an incredibly rich value proposition for our clients, employees, and shareholders," said Vik Kashyap, CEO of Canopy.

In addition, the move expands Canopy's award-winning, flagship product HealthDirect®, the healthcare banking industry's leading electronic payment, administration and account management, and investment technology platform for Health Savings Accounts (HSAs), Flexible Spending Accounts (FSAs), and Health Reimbursement Arrangements (HRAs).

CareGain's Asset Management Platform™ (CAMP) will be integrated with Canopy's HealthDirect®, and the combined product is expected to be available during the fourth quarter of 2008.

"The popularity and growth of consumer-directed healthcare accounts is creating a unique opportunity for both health plans and banks. A truly integrated, multi-custodian FSA, HRA, and HSA administration platform with embedded payment capabilities unlocks a great deal of potential for those in the CDH ecosystem," said Red Gillen, senior analyst with Celent.

"As we sought the best of breed technologies to support our CDH product vision, Canopy and CareGain rose to the top of our list. As a client of both companies, we are excited about the potential this move offers Coventry Health Care and we believe this creates a compelling solution set," said Jim Bridges, vice president, product development with Coventry Health Care.

The Combined Company -- A Clear Technology Leader

The combined company is well positioned to respond to the growing demand for healthcare banking technologies. Facts regarding the combined company include:

--  Manages over one million CDH accounts
--  Serves more than 50 enterprise health plan and bank clients
--  Processes a healthcare payment transaction every eight seconds
--  Administers more than eight million claims each year
--  Supports more than 5,000 unique plan designs
    

Financial Technology Partners LP and FTP Securities LLC (together "FT Partners") acted as exclusive strategic and financial advisor to Canopy in this transaction.

About Canopy Financial

Canopy Financial provides innovative technology solutions that connect healthcare and financial services. Serving some of the world's largest healthcare and financial institutions, Canopy powers the development and delivery of complete healthcare banking services for both consumers and businesses. Founded in 2004, Canopy maintains offices in San Francisco, CA, Chicago, IL, and Plainsboro, NJ. For more information, please visit our web site at www.canopyfi.com or call 1-866-960-4700.

Forward-Looking Statements

This news release contains forward-looking statements that involve risks, uncertainties and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. For example, statements of future product offerings, expected synergies, timing of closing, execution of integration plans and increases in shareholder value as a result of the merger, are all forward-looking statements. Risks, uncertainties and assumptions include the possibility that the market for the sale of certain products and services may not develop as expected; that development of these products and services may not proceed as planned; and that the parties are unable to successfully execute their integration strategies, or achieve planned synergies. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, Canopy's results could differ materially from Canopy's expectations in these statements. Canopy assumes no obligation and does not intend to update these forward-looking statements.