Castlight Health and Vera Whole Health announce merger
Employers will participate in full risk sharing to scale value-based care in the commercial market.
Photo: skynesher/Getty Images
Healthcare data company Castlight Health and primary care provider Vera Whole Health are merging in a deal estimated to be worth $370 million.
Clayton, Dubilier & Rice, Vera's majority equity holder, will invest up to $338 million to support the combination. Anthem, a long-time customer of Castlight, will also make an investment in the combined company, according to Castlight.
Former Aetna chairman and CEO Ron Williams will be chairman of the combined company.
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 4 and a 35% premium to the 30-day volume weighted average share price.
Upon completion of the transaction, Castlight will become a privately held company and shares of Castlight's Class B common stock will no longer be listed on any public market. The parties anticipate that the combination will be completed in the first quarter of 2022.
WHY THIS MATTERS
Castlight technology will be integrated with Vera's value-based primary care offerings to transform how patients access and engage with care, how providers deliver care and how employers and other purchasers pay for care, the company said.
Employers will participate in full risk sharing for the first time, said Maeve O'Meara, CEO of Castlight.
The combined company merges benefits and care navigation, including digital touchpoints, into a patient's primary care, according to Ravi Sachdev, CD&R Partner and member of Vera's Board of Directors.
"We believe a combination of these two innovative companies will transform care in local markets across the country," Sachdev said.
THE LARGER TREND
Anthem joins Morgan Health, the JP Morgan Chase & Co. business focused on the transformation of employee healthcare, and Central Ohio Primary Care, which is among the largest independent physician-owned primary care groups in the country, as key strategic partners in the combined company.
Bryony Winn, president of Anthem Health Solutions said, "We are excited at the potential of this unique combination to deliver a differentiated primary care experience by bringing a value-based care model to the commercial healthcare market."
CD&R's initial investment in Vera was made in early 2021. It followed a series of investments in companies focusing on value-based care, including agilon health, Millennium Physician Group and naviHealth.
ON THE RECORD
"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 CEO 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."
Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com
