Cognizant Technology Solutions has bought TriZetto, the US healthcare IT services provider. Cognizant paid $2.7bn in cash to private equity group Apax – a valuation of nearly four times its $700m turnover. The acquisition grows Cognizant’s healthcare revenue to more than $3bn.

The integrated company will focus on three core areas: traditional IT services; high-growth businesses such as management consulting, business process services and IT infrastructure services; and emerging delivery models, as it looks to capitalise on shifts in health-care information technology driven by regulatory reform.

Although shares originally rose 3% on the back of the announcement, they are now trading flat following speculation that Cognizant had paid too high a price. The deal is subject to regulatory approval and is expected to be completed in the fourth quarter.