Australian health information firm IBA Health last night bought iSoft, the scandal-hit healthcare software group at the heart of the government's flagship multi-billion pound upgrade of the NHS IT system, in a deal worth £140m. IBA, a smaller firm, will pay 1.1 of its own shares, listed in Australia, for each iSoft share. The deal values each iSoft share at 58.1p. IBA plans to refinance iSoft through a share placing, underwritten by ABN Amro, to raise £84m.

Shares in iSoft, which is being investigated over potentially misleading statements to the City, closed up 11% at 52.5p on Tuesday.