Excelera DCE, an Accountable Care Organization and AI platform, and blank-check company Future Health ESG have entered into a definitive business combination agreement that will support the expansion of Excelera’s science-driven approach to managing care for seniors.
If approved, upon completion of the transaction, Excelera Health is expected to list on the Nasdaq under the new ticker symbol XLRA. The transaction values the combined company at an initial enterprise value of approximately $459 million, a multiple of 1.3x annualized Q1 22 revenues of $352 million.
Forty million shares will be issued to the seller at closing, and an earn-out of 20 million additional shares will be payable when Excelera achieves $150 million in revenue for any calendar quarter prior to the fifth anniversary of the closing. Excelera’s parent will roll over 100% of its equity stake into the new company.
After transaction expenses, the proposed business combination is expected to deliver at least $105 million, and up to $282 million of net proceeds, including the contribution of up to $201 million of cash held in Future Health’s trust and a $100 million PIPE priced at $11 per share. PIPE investors have also entered into a forward purchase agreement to acquire an additional $20 million of Future Health shares on the open market prior to closing of the transaction.
Including the earn-out and assuming no redemptions, Excelera’s shareholders will own approximately 64%, Future Health shareholders will own approximately 21%, PIPE investors will own approximately 10%, and Future Health’s sponsors will own approximately 5% of the issued and outstanding shares of the combined company. Read more.
