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.

The acquisition led by Advent International will see the two AI-powered companies combine forces to improve the healthcare payment system.

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.