UpHealth, Inc. (“UpHealth,” the “Company”) (NYSE: UPH), today
announced that it has entered into a definitive agreement to sell
its wholly-owned subsidiary Cloudbreak Health, LLC (“Cloudbreak”),
best known for its Martti translation offering, to GTCR for $180
million in cash. GTCR is a leading private equity firm that
partners with management leaders to identify, acquire and build
market-leading companies through organic growth and strategic
acquisitions.
UpHealth will utilize the proceeds from the sale for payment in
full or in part of the Company’s 2026 Unsecured and 2025 Secured
Notes, as well as other expenses related to the transaction. The
sale of Cloudbreak is expected to close during the first half of
2024, following the receipt of customary regulatory and stockholder
approvals and closing conditions, and will allow UpHealth, Inc. to
pursue a more simplified strategy that focuses on TTC Healthcare,
Inc., a growing, cash flow positive, behavioral health
business.
“This agreement enables Cloudbreak’s leading telehealth and
video remote interpretation solutions to continue to reach
customers and patients who rely on them, while providing UpHealth
with significant liquidity to substantially reduce its existing
debt and drive the business forward with a much healthier capital
structure,” said Martin Beck, Chief Executive Officer of UpHealth.
“At the same time, this transaction sharpens our focus on TTC
Healthcare, a profitable and cash generating behavioral health
business, as a growth platform.”
Cloudbreak is recognized through its core solution, Martti, “My
Accessible Real-Time Trusted Interpreter” and has constituted the
entirety of the Company’s Virtual Care Infrastructure segment since
July 1, 2022. The Martti solution provides medical interpreters in
over 250 languages, which are delivered through custom Martti
devices, such as tablets and smartphones. As part of the
transaction, GTCR will acquire complete equity ownership of
Cloudbreak, including the aggregate Cloudbreak employee base.
Dr. Avi Katz, Chairman of the Board of UpHealth, commented, “As
the Chair of UpHealth since the combination with GigCapital2 in
June 2021 and overseeing the executive team over the last three
years of restructuring and financing, I commend Andy Panos and the
team for leading Cloudbreak’s strategic expansion and growth, more
than doubling revenue in this period, providing a superior customer
service experience, while improving considerably the bottom line of
the business. Additionally, UpHealth is executing on paying down
majority of its debt to our noteholders, with the goal of freeing
capital to grow our behavioral health business.”
DLA Piper LLP (US) is serving as legal counsel to UpHealth for
this transaction.
About UpHealthUpHealth is a global digital health company
that delivers infrastructure and services to dramatically improve
how healthcare is delivered and managed. UpHealth creates digitally
enabled “care communities” that improve access and achieve better
patient outcomes at lower cost, through health solutions.
UpHealth’s clients include health plans, healthcare providers and
community-based organizations. For more information, please
visit https://uphealthinc.com and follow at UpHealth Inc on
LinkedIn.
About GTCRFounded in 1980, GTCR is a leading private
equity firm that pioneered The Leaders Strategy™ – finding and
partnering with management leaders in core domains to identify,
acquire and build market-leading companies through organic growth
and strategic acquisitions. GTCR is focused on investing in
transformative growth in companies in the Business & Consumer
Services, Financial Services & Technology, Healthcare and
Technology, Media & Telecommunications sectors. Since its
inception, GTCR has invested more than $25 billion in over 270
companies, and the firm currently manages over $35 billion in
equity capital. GTCR is based in Chicago with offices in New York
and West Palm Beach. For more information, please visit
www.gtcr.com. Follow GTCR on LinkedIn.
Forward-Looking Statements This press release contains
forward-looking statements within the meaning of U.S. federal
securities laws. Such forward-looking statements include, but are
not limited to, statements regarding obtaining customary
regulatory and stockholder approval, the closing, including its
timing, of the sale of Cloudbreak, the use of proceeds of the sale,
the projected operation and financial performance of UpHealth and
its various subsidiaries, including following the sale of
Cloudbreak, its product offerings and developments and reception of
its product by customers, and UpHealth’s expectations, hopes,
beliefs, intentions, plans, prospects or strategies regarding the
future revenue and the business plans of UpHealth’s management
team. Any statements contained herein that are not statements of
historical fact may be deemed to be forward-looking statements. In
addition, any statements that refer to projections, forecasts, or
other characterizations of future events or circumstances,
including any underlying assumptions, are forward-looking
statements. The words “anticipate,” “believe,” “continue,” “could,”
“estimate,” “expect,” “intends,” “may,” “might,” “plan,”
“possible,” “potential,” “predict,” “project,” “should,” “would”
and similar expressions may identify forward-looking statements,
but the absence of these words does not mean that a statement is
not forward-looking. The forward-looking statements contained in
this press release are based on certain assumptions and analyses
made by the management of UpHealth considering their respective
experience and perception of historical trends, current conditions,
and expected future developments and their potential effects on
UpHealth as well as other factors they believe are appropriate in
the circumstances. There can be no assurance that future
developments affecting UpHealth will be those anticipated. These
forward-looking statements involve a number of risks, uncertainties
(some of which are beyond the control of the parties), or other
assumptions that may cause actual results or performance to be
materially different from those expressed or implied by these
forward-looking statements, including the closing conditions for
the sale of Cloudbreak not being satisfied, the ability of the
parties to close the sale on the expected closing date or at all,
the ability of UpHealth to service or otherwise pay its debt
obligations, including to holders of UpHealth’s convertible notes
in the event the closing does not occur, the mix of services
utilized by UpHealth’s customers and such customers’ needs for
these services, market acceptance of new service offerings, the
ability of UpHealth to expand what it does for existing customers
as well as to add new customers, uncertainty with respect to how
the ICA or the Indian courts shall decide various matters that are
before them or that the Glocal Board will act in compliance with
their fiduciary duties to their shareholders, that UpHealth will
have sufficient capital to operate as anticipated, and the impact
that the novel coronavirus and the illness, COVID-19, that it
causes, as well as government responses to deal with the spread of
this illness and the reopening of economies that have been closed
as part of these responses, may have on UpHealth’s operations, the
demand for UpHealth’s products, global supply chains and economic
activity in general. Should one or more of these risks or
uncertainties materialize or should any of the assumptions being
made prove incorrect, actual results may vary in material respects
from those projected in these forward-looking statements. UpHealth
undertakes no obligation to update or revise any forward-looking
statements, whether because of new information, future events, or
otherwise, except as may be required under applicable securities
laws.
Additional Information and Where to Find It
In connection with the proposed transaction, the Company will
file with the Securities and Exchange Commission (the “SEC”) and
furnish to the Company’s stockholders a proxy statement. BEFORE
MAKING ANY VOTING DECISION, THE COMPANY’S STOCKHOLDERS ARE URGED TO
READ THE PROXY STATEMENT IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE
AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH
THE PROPOSED TRANSACTION OR INCORPORATED BY REFERENCE IN THE PROXY
STATEMENT (IF ANY) BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE PROPOSED TRANSACTION AND THE PARTIES TO THE PROPOSED
TRANSACTION. Investors and stockholders may obtain a free copy of
documents filed by the Company with the SEC at the SEC’s website at
http://www.sec.gov. In addition, investors and stockholders may
obtain a free copy of the Company’s filings with the SEC from the
Company’s website at http://investors.uphealthinc.com.
Participants in the Solicitation
The Company and certain of its directors, executive officers,
and certain other members of management and employees of the
Company may be deemed to be participants in the solicitation of
proxies from stockholders of the Company in favor of the proposed
transaction. Information about directors and executive officers of
the Company is set forth in the proxy statement for the Company’s
Annual Meeting, as filed with the SEC on Schedule 14A on November
15, 2022. Additional information regarding the interests of these
individuals and other persons who may be deemed to be participants
in the solicitation will be included in the proxy statement with
respect to the proposed transaction that the Company will file with
the SEC and furnish to the Company’s stockholders.
Contacts:
Investor Relations:Shannon Devine (MZ North America)Managing
Director203-741-8811
UPH@mzgroup.us
UpHealth (PK) (USOTC:UPHL)
Historical Stock Chart
From May 2024 to Jun 2024
UpHealth (PK) (USOTC:UPHL)
Historical Stock Chart
From Jun 2023 to Jun 2024