Well Health Technologies (TSX: WELL) this morning announced that it is moving into the US market via the acquisition of a majority stake in Circle Medical Ltd, through a combination of cash and common shares. Subsequently, the company also announced a $23.0 million financing via Hong Kong business leader Li Ka-shing.
Circle Medical is a telemedicine provider that currently provides telehealth services across the US. In the past 100 days, the company has provided such services in 35 states across the country, with the remaining states to be addresssed in the coming months. The firm currently has agreements in place with most of the major health insurance providers in the US, enabling access to roughly 200 million Americans.
Under the terms of the transaction, two parts are to occur to enable Well Health to acquire its control position. First, the company will acquire roughly US$9.0 million worth of common shares of the company through the issuance of shares in Well Health, at a price per share of C$4.77, with certain shares being paid for in cash for which further details were not provided. The company will then acquire US$5.0 million worth of common shares from the firms treasury, which will provide funds for growth to the firm.
The company will then receive a call option on the portion of the company that it does not currently own, however specific ownership percentages were not disclosed. The prior owners of the company will continue to operate Circle Medical on a post-closing basis.
The $23.0 million financing that was subsequently announced is to occur at $4.77 per share, with proceeds used to fund the transaction. A timeline for closing was not provided.
Well Health last traded at $4.83 on the TSX.
Information for this briefing was found via Sedar and WELL Health Technologies Corp. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
The Grocery Grift: Why Toronto and New York Are About to Light Taxpayer Money on Fire