NEW YORK, July 29, 2020 /PRNewswire/ -- SOC Telemed
("SOC"), one of the largest national providers of acute care
telemedicine, and Healthcare Merger Corp. ("HCMC") (NASDAQ: HCCO),
a special purpose acquisition company, announced today that they
have entered into a definitive agreement for a business
combination. The combined company will operate as SOC Telemed and
will be listed on the Nasdaq. The transaction implies an initial
enterprise value for SOC of approximately $720 million.
SOC is a leading provider of acute telemedicine solutions that
are used primarily inside hospitals alongside onsite care teams to
provide time-sensitive specialty care when patients are their most
vulnerable. SOC provides a differentiated solution through the
integration of three critical elements, (i) a proven software
platform, (ii) a panel of consult coordination experts, and (iii) a
network of clinical specialists, all three of which are combined
into a seamless, acute telemedicine solution. SOC provides services
to 847 facilities including 543 acute care hospitals in 47 states,
including 19 of the 25 largest U.S. health systems. SOC is the
largest provider of acute teleNeurology and telePsychiatry, and has
delivered over one million acute care consultations.
SOC's management team is led by Paul
Ricci, Interim Chief Executive Officer, John Kalix, President, and Hai Tran, Chief Operating Officer and Chief
Financial Officer. At the completion of the proposed business
combination, Mr. Ricci, who is an advisor to Warburg Pincus, will
step down as Interim Chief Executive Officer. Steve Shulman, the Chief Executive Officer and a
director of HCMC, will become the Chairman of the SOC Telemed board
of directors, and John Kalix will be
appointed Chief Executive Officer. Hai
Tran will continue as Chief Operating Officer and Chief
Financial Officer. SOC's existing majority equity holder, Warburg
Pincus, a leading global growth equity firm, will remain SOC's
largest shareholder.
"This business combination strengthens SOC Telemed and will
allow it to further penetrate the broad and fast-growing acute
telemedicine market," stated Mr. Ricci. "Telemedicine is at a
pivotal moment as the country continues to navigate the COVID-19
crisis. As hospital leaders struggle with the problems of acute
capacity management, physician scarcity and cost optimization, it
has become clear that virtual care will continue to be a critical
component of the healthcare industry's ability to deliver better
care to patients."
"We are pleased to partner with SOC to drive its next phase of
growth. SOC operates a scaled and differentiated acute care
telemedicine platform," said Mr. Shulman. "This transaction will
enable the company to capitalize on substantial opportunities to
expand and grow and benefit from the accelerated adoption of
telemedicine as a result of COVID-19."
TJ Carella, Managing Director at Warburg Pincus, said, "We are
excited to join forces with the HCMC team and to continue our
partnership with SOC in delivering value to its many customers."
Amr Kronfol, Managing Director at Warburg Pincus, added, "We are
very grateful to Paul for his leadership of SOC and believe that
Steve and John are well positioned to drive the company forward in
this next phase of its growth."
HCMC is a Nasdaq-listed public investment company. HCMC's
strategy is to identify and complete business combinations with
unique, differentiated companies, catalyzed by access to growth
capital from the public equity markets. HCMC's management team has
extensive experience acquiring and managing businesses in the
healthcare industry and leverages its relationship with MTS Health
Partners, L.P., a leading investment banking firm focused
exclusively on the healthcare industry.
"SOC fits perfectly with HCMC's differentiated expertise in the
healthcare industry and we look forward to working together to
drive growth in the public markets with increased capital and the
benefit of HCMC's relationships and experience," said Charlie Ditkoff, President of HCMC.
Key Transaction Terms
Institutional Investors, including funds and accounts managed by
BlackRock Inc., Baron Capital Group, and ClearBridge Investments,
among others, have committed to a private investment of
$165 million in common stock of the
combined company that will close concurrently with the business
combination. In addition, HCMC currently holds approximately
$250 million in its trust
account.
SOC's current management and equity holders, including Warburg
Pincus, will roll a portion of their equity into SOC, and the
proceeds generated by the transaction will be used to pay down
existing debt, purchase a portion of the equity owned by existing
SOC shareholders, and capitalize the SOC Telemed balance sheet.
Assuming no redemptions of HCMC public shares, current SOC
equity holders will own 40%, HCMC shareholders will own 32%, PIPE
investors will own 21%, and HCMC's sponsor will own 7% of the
issued and outstanding shares of common stock of SOC immediately
following the closing, respectively.
The proposed business combination is expected to be completed in
the fourth quarter of 2020, subject to (i) approval by HCMC's
stockholders, (ii) the expiration of the Hart Scott Rodino
Antitrust Improvements Act of 1976 waiting period and (iii) other
customary closing conditions.
A more detailed description of the transaction terms and a copy
of the agreement and plan of merger (the "Merger Agreement") will
be included in a current report on Form 8-K to be filed by HCMC
with the United States Securities and Exchange Commission ("SEC").
HCMC will file a registration statement (which will contain a joint
proxy statement/consent solicitation statement/prospectus) with the
SEC in connection with the transaction.
Advisors
Credit Suisse served as financial advisor to SOC and acted as
placement agent on the private offering. Orrick Herrington & Sutcliffe LLP served as
legal counsel to SOC. MTS Health Partners, L.P. served as financial
advisor and Weil, Gotshal & Manges LLP and Ellenoff Grossman
& Schole LLP served as legal counsel to HCMC. Cantor Fitzgerald
& Co. served as capital markets advisor to HCMC.
Management Presentation
A presentation made by the management of SOC and HCMC regarding
the transaction will be available on SOC's website
(www.soctelemed.com/press-room). In connection with this event,
HCMC will file an investor presentation with the SEC which can be
viewed at www.sec.gov.
About SOC
Specialists On Call, Inc. (d/b/a SOC Telemed) (SOC) is the
largest national provider of telemedicine technology and solutions
to hospitals, health systems, post-acute providers, physician
networks, and value-based care organizations. Built on proven and
scalable infrastructure as an enterprise-wide solution, SOC's
technology platform, Telemed IQ, rapidly deploys and seamlessly
optimizes telemedicine programs across the continuum of care. SOC
provides a supportive and dedicated partner presence, virtually
delivering patient care through teleNeurology, telePsychiatry and
teleICU as well as enabling healthcare organizations to build
sustainable telemedicine programs in any clinical specialty. SOC
enables organizations to enrich their care models and touch more
lives by supplying healthcare teams with industry-leading solutions
that drive improved clinical care, patient outcomes, and
organizational health. SOC was the first provider of acute clinical
telemedicine services to earn The Joint Commission's Gold Seal of
Approval and has maintained that accreditation every year since
inception. SOC is backed by Warburg Pincus. For more information,
visit www.soctelemed.com.
About HCMC
Healthcare Merger Corp. (HCMC) is a public investment vehicle
formed for the purpose of effecting a merger, capital stock
exchange, asset acquisition, stock purchase, reorganization or
similar business combination with one or more businesses. HCMC's
securities are traded on the NASDAQ under ticker symbols HCCO,
HCCOU, and HCCOW. HCMC raised $250
million of cash proceeds in an initial public offering in
December 2019. HCMC is led by Chief
Executive Officer Steve Shulman,
President Charlie Ditkoff and Chief
Financial Officer Dennis M. Conroy
and is principally sponsored by Shulman Ventures LLC and MTS Health
Partners, LP.
About Warburg Pincus
Warburg Pincus LLC is a leading global private equity firm
focused on growth investing. The firm has more than $53 billion in private equity assets under
management. The firm's active portfolio of more than 185 companies
is highly diversified by stage, sector, and geography. Warburg
Pincus is an experienced partner to management teams seeking to
build durable companies with sustainable value. Founded in 1966,
Warburg Pincus has raised 19 private equity funds, which have
invested more than $84 billion in
over 900 companies in more than 40 countries. The firm is
headquartered in New York with
offices in Amsterdam, Beijing, Berlin, Hong
Kong, Houston, London, Luxembourg, Mumbai, Mauritius, San
Francisco, São Paulo, Shanghai, and Singapore. For more information please visit
www.warburgpincus.com.
Forward-Looking Statements
This press release may contain a number of "forward-looking
statements" as defined in the Private Securities Litigation Reform
Act of 1995. Forward-looking statements include statements about
the expected timing of the completion of this transaction and
information concerning HCMC's or SOC's possible or assumed future
results of operations, business strategies, debt levels,
competitive position, industry environment, potential growth
opportunities and the effects of regulation, including whether this
transaction will generate returns for stockholders. These
forward-looking statements are based on HCMC's or SOC's
management's current expectations, estimates, projections and
beliefs, as well as a number of assumptions concerning future
events. When used in this press release, the words "estimates,"
"projected," "expects," "anticipates," "forecasts," "plans,"
"intends," "believes," "seeks," "may," "will," "should," "future,"
"propose" and variations of these words or similar expressions (or
the negative versions of such words or expressions) are intended to
identify forward-looking statements.
These forward-looking statements are not guarantees of future
performance, conditions or results, and involve a number of known
and unknown risks, uncertainties, assumptions and other important
factors, many of which are outside HCMC's or SOC's management's
control, that could cause actual results to differ materially from
the results discussed in the forward-looking statements. These
risks, uncertainties, assumptions and other important factors
include, but are not limited to: (a) the occurrence of any event,
change or other circumstances that could give rise to the
termination of the Merger Agreement and the proposed transactions
contemplated thereby, (b) the inability to complete the
transactions contemplated by the Merger Agreement due to the
failure to obtain approval of the stockholders of HCMC or other
conditions to closing in the Merger Agreement, (c) the ability to
meet Nasdaq's listing standards following the consummation of the
transactions contemplated by the Merger Agreement, (d) the
inability to complete the private placement, (e) the risk that the
proposed transactions disrupt current plans and operations of SOC
or its subsidiaries as a result of the announcement and
consummation of the transactions described herein, (f) the ability
to recognize the anticipated benefits of the proposed transactions,
which may be affected by, among other things, competition, the
ability of the combined company to grow and manage growth
profitably, maintain relationships with healthcare organizations
and network of qualified physicians and other provider specialists
and retain its management and key employees, (g) costs related to
the proposed transactions, (h) changes in applicable laws or
regulations, (i) the possibility that SOC may be adversely affected
by other economic, business, and/or competitive factors and (j)
other risks and uncertainties indicated in the preliminary or
definitive joint proxy statement/consent solicitation
statement/prospectus that forms a part of the registration
statement, including those under "Risk Factors" therein, and other
documents filed or to be filed with the SEC by HCMC. You are
cautioned not to place undue reliance upon any forward-looking
statements, which speak only as of the date made.
Forward-looking statements included in this press release speak
only as of the date of this press release. Except as required by
law, neither HCMC nor SOC undertakes any obligation to update or
revise its forward-looking statements to reflect events or
circumstances after the date of this release. Additional risks and
uncertainties are identified and discussed in HCMC's reports filed
with the SEC and available at the SEC's website at www.sec.gov.
Disclaimer
This press release is for informational purposes only and shall
not constitute an offer to sell or the solicitation of an offer to
buy any securities pursuant to the proposed transactions or
otherwise, nor shall there be any sale of securities in any
jurisdiction in which the offer, solicitation or sale would be
unlawful prior to the registration or qualification under the
securities laws of any such jurisdiction. No offer of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act.
INVESTMENT IN ANY SECURITIES DESCRIBED HEREIN HAS NOT BEEN
APPROVED OR DISAPPROVED BY THE SEC OR ANY OTHER REGULATORY
AUTHORITY NOR HAS ANY AUTHORITY PASSED UPON OR ENDORSED THE MERITS
OF THE PROPOSED TRANSACTIONS OR THE ACCURACY OR ADEQUACY OF THE
INFORMATION CONTAINED HEREIN. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
Additional Information About the Transactions
HCMC intends to file a registration statement with the SEC,
which will contain a joint proxy statement/consent solicitation
statement/prospectus, in connection with the proposed transactions
contemplated by the Merger Agreement and will mail the definitive
joint proxy statement/consent solicitation statement/prospectus and
other relevant documents to its stockholders. The registration
statement will contain important information about the proposed
transactions contemplated by the Merger Agreement and the other
matters to be voted upon at a meeting of stockholders to be held to
approve the proposed transactions contemplated by the Merger
Agreement and other matters (the "Special Meeting") and is not
intended to provide the basis for any investment decision or any
other decision in respect of such matters. HCMC stockholders and
other interested persons are advised to read, when available, the
preliminary joint proxy statement/consent solicitation
statement/prospectus that forms a part of the registration
statement, the amendments thereto, and the effective registration
statement and definitive joint proxy statement/consent solicitation
statement/prospectus in connection with HCMC's solicitation of
proxies for the Special Meeting because those documents will
contain important information about the proposed transactions. When
available, the definitive joint proxy statement/consent
solicitation statement/prospectus will be mailed to HCMC
stockholders as of a record date to be established for voting on
the proposed transactions contemplated by the Merger Agreement and
the other matters to be voted upon at the Special Meeting. HCMC
stockholders will also be able to obtain copies of the registration
statement, the joint proxy statement/consent solicitation
statement/prospectus and all other relevant documents filed or that
will be filed with the SEC in connection with the proposed
transactions, without charge, once available, at the SEC's website
at www.sec.gov or by directing a request to: Healthcare Merger
Corp., 623 Fifth Avenue, New York,
NY 10022, attention: Dennis
Conroy (email: Conroy@mtspartners.com).
Participants in the Solicitation
HCMC, SOC and certain of their respective directors, executive
officers and other members of management and employees may be
deemed participants in the solicitation of proxies of HCMC
stockholders in connection with the proposed transactions. HCMC
stockholders and other interested persons may obtain, without
charge, more detailed information regarding the directors and
officers of HCMC in HCMC's Annual Report on Form 10-K for the
fiscal year ended December 31, 2019,
which was filed with the SEC on March 25,
2020. Information regarding the persons who may, under SEC
rules, be deemed participants in the solicitation of proxies to
HCMC stockholders in connection with the proposed transactions
contemplated by the Merger Agreement and other matters to be voted
upon at the Special Meeting will be set forth in the registration
statement for the proposed transactions when available. Additional
information regarding the interests of participants in the
solicitation of proxies in connection with the proposed
transactions will be included in the registration statement that
HCMC intends to file with the SEC.
Contacts:
Investor Relations
Bob
East or Jordan Kohnstam
Westwicke, an ICR company
SOCIR@westwicke.com
(443) 213-0500
Media Relations
Sean
Leous
Westwicke, an ICR company
SOCPR@westwicke.com
(646) 866-4012
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SOURCE SOC Telemed