Waystar (WAY) said it will acquire health AI software company, Iodine Software, for a total enterprise value of $1.25B. The company expects that the integration of Iodine will enhance its gross margin and adjusted EBITDA margin immediately.

The acquisition will enable Waystar to automate tasks such as utilisation management and clinical documentation integrity.

Healthcare-software company Waystar has agreed to buy private-equity backed Iodine Software for $1.25 billion, including debt. The transaction was announced Wednesday afternoon, confirming a prior report by The Wall Street Journal. Waystar will fund the deal with an equal mix of cash and stock.