INTRODUCTION
This Rule 13E-3 Transaction Statement on
Schedule 13E-3, together with the exhibits hereto (this “Schedule 13E-3” or “Transaction Statement”), is being
filed with the Securities and Exchange Commission (the “SEC”) pursuant to Section 13(e) of the Securities Exchange Act of 1934, as amended (together with the rules and regulations promulgated thereunder, the “Exchange
Act”), jointly by the following persons (each, a “Filing Person,” and collectively, the “Filing Persons”): (i) Inovalon Holdings, Inc. (“Inovalon” or the “Company”), a
Delaware corporation and the issuer of the Class A common stock, par value $0.000005 per share (the “Class A Common Stock”) and the Class B common stock, par value $0.000005 per share (the
“Class B Common Stock”, and together with the Class A Common Stock, the “Shares”), that is subject to the Rule 13e-3 transaction, (ii) Ocala
Bidco, Inc., a Delaware corporation (“Parent”), (iii) Ocala Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), (iv) Nordic Capital Epsilon GP SARL,
(v) Nordic Capital Epsilon SCA, SICAV-RAIF, a société en commandite par actions – société d’investissement à capital variable – fonds d’investissement alternatif
réservé, on behalf of its compartment, Nordic Capital Epsilon SCA, SICAV-RAIF - Compartment 1, a private equity investment vehicle and an affiliate of Parent and Merger Sub (“Nordic Capital X” and, collectively
with Nordic Capital Epsilon GP SARL, Parent and Merger Sub, the “Parent Entities”), (vi) Keith R. Dunleavy, M.D., Inovalon’s Chairman and Chief Executive Officer, (vii) Meritas Group, Inc., a Delaware corporation
affiliated with Dr. Dunleavy, and (viii) Cape Capital SCSp, SICAR – Inovalon Sub-Fund, a Luxembourg special limited partnership organized as an investment company in risk capital under the law
of June 14, 2004 (“Cape Capital”) and (ix) André Hoffmann. The Parent Entities and André Hoffmann are Filing Persons of this Transaction Statement because they may be deemed to be affiliates of the
Company under a possible interpretation of the SEC rules governing “going-private” transactions.
On August 19, 2021, the
Company, Parent and Merger Sub entered into an Agreement and Plan of Merger (as amended, restated, supplemented or otherwise modified from time to time, the “Merger Agreement”), which provides for, among other things, the merger of
Merger Sub with and into the Company (the “Merger”), with the Company surviving the Merger as a direct wholly owned subsidiary of Parent. Concurrently with the filing of this
Schedule 13E-3, the Company is filing with the SEC a preliminary proxy statement (the “Proxy Statement”) under Regulation 14A of the Exchange Act, relating to a special meeting of
the stockholders of the Company (the “Special Meeting”) at which the stockholders of the Company will consider and vote upon a proposal to approve and adopt the Merger Agreement and cast a
non-binding, advisory vote to approve certain items of compensation that are based on or otherwise related to the Merger and may become payable to certain named executive officers of the Company under existing
agreements with the Company. The adoption of the Merger Agreement will require the affirmative vote of: (i) the holders of a majority of the voting power of the Company’s outstanding common stock, with holders of the outstanding
Class A Common Stock and holders of the outstanding Class B Common Stock entitled to vote in accordance with the DGCL voting together as a single class; (ii) the holders of a majority of the outstanding shares of Class A Common
Stock entitled to vote in accordance with the DGCL; (iii) the affirmative vote of holders of a majority of the outstanding shares of Class B Common Stock entitled to vote in accordance with the DGCL; and (iv) the holders of a majority
of the voting power of the Company’s outstanding common stock held by the Company’s stockholders other than the Rollover Stockholders (as defined below), their respective affiliates or any executive officer or director of the Company (the
“Public Stockholders”), with holders of Class A Common Stock and Class B Common Stock voting as a single class, in each case based on such shares outstanding as of the close of business on the record date for the Special
Meeting. A copy of the Proxy Statement is attached hereto as Exhibit (a)(2)(i). A copy of the Merger Agreement is attached as Annex A to the Proxy Statement and incorporated herein by reference.
Under the terms of the Merger Agreement, if the Merger is completed, each Share, other than as provided below, will be converted into the
right to receive $41.00 in cash (the “Merger Consideration”), without interest and less applicable withholding taxes. The following Shares will not be converted into the right to receive the per Share Merger Consideration in
connection with the Merger: (i) certain shares held by Dr. Dunleavy and Cape Capital (the “Rollover Stockholders”) who will, pursuant to the terms of certain rollover agreements, dated as of August 19, 2021, exchange
such shares of Company common stock for equity interests of Ocala Topco, Inc., a Delaware corporation, which in turn will be exchanged for equity interests of Ocala Topco, LP, a Delaware limited partnership, in each case subject to the terms and
conditions of the applicable rollover agreement;