Troubled UK National Health Service (NHS) software supplier iSoft has agreed terms of a sale for around £140m to Australian software firm IBA.

The sale follows financial scandals that hit the company last year and led to delays in delivery of its Lorenzo care record software, a key component of the NHS's £12.4bn National Programme for IT (NPfIT).

The Australian firm first revealed it was interested in acquiring iSoft earlier this year. Ironically, iSoft partner Torex - which is also currently mired in financial scandal after an expensive, two-year acquisition spree - used to be a distributor for IBA in the UK before the two firms merged in 2003. At the time an Office of Fair Trading investigation instigated as a result of a complaint brought by IBA against the merger was rejected, allowing it to go ahead.

Meanwhile, iSoft is still under investigation by the Financial Services Authority and the Accountancy Investigation and Disciplinary Board as result of discrepancies revealed last year in its accounting practices, which led to it posting a £14.6m loss.

Connecting for Health, the project management for NPfIT, declined to comment on how the acquisition would affect its use of Lorenzo.