What You Should Know:
– Castlight Health and Vera Health announce merger, the combined company will integrate Castlight’s market-leading navigation technology with Vera’s best in class advanced primary care model to expand access to care, reduce healthcare costs, and improve outcomes.
Castlight Health, Inc. (“Castlight”) (NYSE: CSLT), a healthcare data and navigation company, and Vera Whole Health, Inc. (“Vera”), a pioneer in advanced primary care, jointly announced a merger agreement under which the companies will combine. The combined company will integrate Castlight’s market-leading technology with Vera’s purpose-built clinics, health care professionals and strategic partnerships with local providers, with the potential to transform how patients access and engage with care, how providers deliver care, and how employers and other purchasers pay for care.
Vera is the only care model with the capability to deliver whole system health to a diverse patient population from a single care center. The Vera model is uniquely designed to help people achieve optimum social, psychological, and physical well-being – an outcome that’s neither probable nor affordable within the current sick-care system.
Financial Terms of Merger
The merger, which has been unanimously approved by Castlight’s Board of Directors, is valued at an equity value of approximately $370M and will be structured as an all-cash tender offer to acquire all outstanding shares of Castlight. Under the terms of the agreement, Vera will commence a tender offer to acquire all outstanding shares of Castlight Class A common stock and Class B common stock for $2.05 in cash per share, representing a 25% premium to the closing price as of January 4th, 2022, and a 35% premium to the 30-day volume-weighted average share price. Clayton, Dubilier & Rice (“CD&R”) funds, Vera’s majority equity holder, have committed to invest up to $338 million to support the combination, and Anthem, Inc. (”Anthem”), a leading health company and long-time strategic customer of Castlight, will make an investment in the combined company.
Anthem joins Morgan Health, the JP Morgan Chase & Co business focused on the transformation of employee healthcare, and Central Ohio Primary Care, the largest independent physician-owned primary care group in the country, as key strategic partners in the combined company. CD&R’s initial investment in Vera was made in early 2021 and followed a series of investments in companies focusing on value-based care, including agilon health, Millennium Physician Group, and naviHealth.
Scale Value-Based Care in Commercial Market
“Integrating our navigation data and technology with Vera’s high quality primary care offering addresses the fundamental need for a coordinated and personalized patient experience, while enabling providers to improve outcomes and lower costs and employers to participate in full risk sharing for the first time,” said Maeve O’Meara, Chief Executive Officer of Castlight. “We are thrilled to work with Vera and CD&R to open this new frontier of healthcare.”
“Equipping our advanced primary care teams and our patients with Castlight’s industry leading digital navigation and engagement capabilities enhances our ability to reduce total cost of care while improving the social, mental and physical health of our patients,” said Ryan Schmid, Founder and Chief Executive Officer of Vera. “Personalizing care plans and engagement campaigns while providing our care teams and patients with quality and cost data will greatly enhance the patient journey and our ability to manage commercial populations.”
