GE Healthcare is streamlining its focus. The Chalfont, U.K.-based company has received a $1.05 billion bid for its Value-Based Care division from Veritas Capital. The divestiture of the business is set to close in the third quarter of 2018. The deal would help to create a leaner GE Healthcare that is more focused on its diagnostics and artificial intelligence offerings.

Veritas is acquiring GE Healthcare’s assets in ambulatory care management, enterprise financial management and workforce management. The acquisition continues Veritas’ growing presence in the healthcare space. The private equity company recently invested in Truven Health and Verscend Technologies.

“We see a tremendous opportunity to invest in this business and partner with management to take advantage of a $9 billion market that continues to benefit from favorable sector trends, particularly a real and urgent need to digitalize our healthcare system,” Ramzi Musallam, CEO and Managing Partner of Veritas Capital, said in a prepared statement. “Similar to our previous healthcare technology investments, all of which have been corporate carve outs, we will be deeply customer-focused, and invest significantly in people, technology and infrastructure to support the evolving requirements of the company’s diverse customer group.”

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Time for a change

After abysmal 3Q17 earnings, GE Healthcare’s CEO, John Flannery said he was planning to divest more than $20 billion worth of assets over the next one to two years and the firm a more streamlined company. The company has been in a state of turmoil, with its stock price down more than 20 percent year to date.

"We know what the issues are,” Flannery said during an Oct. 2017 call with analysts. “We know what we need to do to fix them, and I'd characterize this as largely a self-help story. From here forward, we reset the company for a better future."

And Flannery moved quickly on this promise. During that time, health IT security firm Imprivata said it has acquired the identity and access management portion of Caradigm from GE Healthcare. Financial details of the sale were not disclosed.

Prior to Flannery’s declaration to divest $20 billion in assets, GE sold its financial business known as GE Capital to Capital One Financial Corp. for $9 billion, in 2015. The financial business was a huge liability for GE during the Great Recession.

GE Healthcare isn’t the only large medtech company working to streamline its focus. Johnson & Johnson has been making plans for more than a year to jettison off parts of its underperforming diabetes unit.

The New Brunswick, NJ-based company recently said it was selling its LifeScan unit to Platinum Equity for $2.1 billion. LifeScan develops blood glucose monitoring products and earned $1.5 billion in revenue in 2017.