Netsmart Technologies Inc. is nearing completion of negotiationsthat would make the company the second largest tenant at thesprawling Long Island Business & Technology Center in Great River.
Under the proposed deal, the maker of software used by health andhuman services agencies would nearly double the space in its current 18,000-foot facility in Islip, taking 35,000-square-feet inthe former Grumman facility at 3500 Sunrise Highway.
James Conway, chief executive of Netsmart, cautioned that severalsticking points remained in the negotiations.
'I can't tell you 100 percent we will sign,' said the former ITTexecutive.
North Hills-based Spector Group served as LIB&TC's architect,while the Phillips Group's Melville office designed the high-techthemed interior space for Netsmart.
The lease on Netsmart's current headquarters at 146 Nassau Avenuein Islip expires Dec. 31. The company also has smaller offices inColumbus, Ohio, and San Diego.
Netsmart subsidiary Creative Socio-Medics, essentially thecompany's operations arm, has been on a tear, signing a flurry ofcontracts, spurred in part by the phase in of new federal HealthInsurance Portability and Accountability Act rules that requirehealth care providers to standardize electronic transactions andsafeguard privacy and security.
In September, Netsmart announced a $1 million contract with NewHampshire Hospital, in August a $500,000 contract with Lake GroveTreatment Center, in July a $1.2 million contract with Nevada'sDepartment of Human Resources.
Typically, customers are charged $250,000 to $1 million forinstallation of Creative Socio-Medics' Avatar software suite. Thesystems cover billing, patient tracking, medical record managementand scheduling for inpatient and outpatient services and can be usedwith handheld computer systems.
For the second quarter ended June 30, Netsmart posted net incomeof 12 cents per diluted share, triple that of the previous year'squarter. Order backlog hit a record $25.3 million.
Those contracts have helped fuel the company's stock (NasdaqSC:NTST), which has climbed 171 percent from a 52-week low of $3.53 onMarch 6 to a recent $10.90.
Overall, Netsmart had 145 employees as of the end of 2002, upfrom 136 at the end of 2001.
Eleven-year-old Netsmart, originally known as Medical ServicesCorp., has grown partly through acquisitions. In 1997, the companybought assets of Johnson Computing Systems in a stock deal valued at$300,000.
In 2000, it bought the Connex suite of managed care informationsystems from Behavioral Health Partners Inc., and the following yearit bought intellectual property and other assets of AdvancedInstitutional Management Software.
In June, Netsmart acquired intellectual property and customercontracts from the CareNet unit of Shuttle Data Systems Corp. in astock and cash deal worth about $2.1 million.
Last September, Netsmart hired Fleet M&A Advisors to exploreacquisitions as well as mergers, partnerships or joint ventures.
One strategy the company was exploring involved allying with oneof the giants in the healthcare technology segment, such as EDS,Siemens, Cerner.
