1Life Healthcare, Inc. (One Medical) (Nasdaq: ONEM), a leading
human-centered and technology-powered primary care organization,
today announced it has entered into a definitive agreement to
acquire Iora Health, a human-centric, value-based primary care
group with built-for-purpose technology focused on serving Medicare
populations, in an all-stock transaction valued at approximately
$2.1 billion.
“We are delighted to announce plans to combine with Iora Health,
a technology-powered primary care leader delivering outstanding
member-based, value-based care for adults 65+ enrolled in Medicare
Advantage and other at-risk reimbursement models. Together we will
expand our addressable market to serve more members in more
geographies with digital and in-person care across every stage of
life, with further capabilities to deliver care within full-risk
models. Together with Iora Health, we can deliver better health,
better care, and lower costs for children, adults, and seniors,”
said Amir Dan Rubin, Chair & CEO of One
Medical.
“Chris McKown and I founded Iora Health over 10 years ago to
build an innovative primary care model that transforms lives and
improves outcomes through relationship-based care, and we are
excited to take this next exciting step with One Medical,” said
Rushika Fernandopulle, M.D., MPP, Co-Founder and
Chief Executive Officer of Iora Health. “Together, with our aligned
cultures, shared mission, and complementary models, we can drive
even greater impact for our patients, our teams, and our investors,
and most importantly, our shared vision of transforming
healthcare.”
One Medical and Iora Health are aligned in their missions,
models, and cultures to transform healthcare for key stakeholders
-- Consumers, Employers and Payers, Providers, and Health Networks.
Together, the two companies can further accelerate and build upon
their impacts for these stakeholders, while simultaneously
expanding their models in existing markets, entering new markets,
serving new populations, expanding full-risk models, and leveraging
their purpose-built technologies for increased growth and
scale.
Strategic and financial benefits of the transaction include:
- Creates a premier
national member-based, technology-powered primary care platform to
deliver better health, better care, and lower costs across
Commercial and Medicare populations;
- Positions One
Medical with Iora Health to advance the health of members across
every stage of life;
- Extends One
Medical’s platform to deliver multi-modal care with 24/7 national
digital health and in-person care across a combined 28 markets and
beyond;
- Expands potential
market opportunity to $870 billion across Commercial and Medicare
segments, including the new Medicare Direct Contracting
program;
- Enhances One
Medical’s risk-taking capabilities and extends One Medical into
full-risk Medicare reimbursement models;
- Amplifies the
power of purpose-built technologies to deliver premier member
experiences, population health, provider support, and value-based
care across every stage of life;
- Accelerates the
expansion of two high-growth organizations, with complementary
cultures and models serving as a premier place to practice
modernized healthcare; and,
- Offers an
opportunity to create significant value, with an expected $350+
million in annual revenue synergies by 2025, ~$30 million in annual
net cost synergies by 2025, and with ~$30 million in cumulative
capex savings through 2025.
“One Medical has proven its ability to drive profitable
membership growth, engage with members, improve health outcomes and
lower costs. I am excited at the prospect of creating even more
differentiation by adding Iora Health’s Medicare-focused
capabilities, expanding our reach to 28 markets, and offering
our service experience to the parents and grandparents of our 598
thousand members,” said Bjorn Thaler, Chief
Financial Officer, One Medical.
Leadership and Governance
A designee of Iora Health will join the One Medical Board and
Rushika Fernandopulle will become One Medical’s Chief Innovation
Officer.
Transaction Details
Under the terms of the agreement, Iora Health shareholders will
receive 56.1 million shares of One Medical common stock. Based on
the closing share price of One Medical’s common stock of $35.59 on
June 4th, 2021, the total transaction is valued at approximately
$2.1 billion. Upon completion of the transaction, Iora Health
shareholders are expected to own approximately 26.75% of the
combined company.
The transaction is expected to close in late Q3 or Q4 of 2021
and is subject to customary closing conditions, including approval
by One Medical and Iora Health stockholders and receipt of
regulatory approval.
Advisors
Morgan Stanley & Co. LLC served as exclusive financial
advisor to One Medical and Cooley LLP served as legal advisor.
Credit Suisse served as exclusive financial advisor to Iora
Health and Skadden, Arps, Slate, Meagher & Flom LLP served as
legal advisor.
Conference Call Details
One Medical will host a conference call at 5:00 a.m. (PT) / 8:00
a.m. (ET) on Monday, June 7, 2021, to discuss this transaction. A
live audio webcast and a supplemental presentation will be
available online at https://investor.onemedical.com. The
conference call can also be accessed by dialing 1-800-258-1651 for
U.S. participants, or 1-612-979-9928 for international
participants, and referencing conference ID 2077477. A replay of
the call will be available via webcast for on-demand listening
shortly after the completion of the call, at the same web link, and
will remain available for approximately 90 days.
Available Information
Additional information is available at
https://onemedical.com/announcing-iora. One Medical intends to use
its Company website (including its Investor Relations website) as
well as its Facebook, Twitter and LinkedIn accounts as a means of
disclosing material non-public information and for complying with
its disclosure obligations under Regulation FD.
Additional Information and Where to Find It
One Medical plans to file with the SEC, and the parties plan to
furnish to the security holders of Iora Health and One Medical, a
Registration Statement on Form S-4, which will constitute a
prospectus and proxy statement of One Medical and will include an
information statement of Iora Health, in connection with the
proposed Merger, referred to as a proxy statement/prospectus,
whereupon the separate corporate existence of Merger Sub shall
cease and Iora Health shall continue as the surviving corporation
of the Merger as a direct wholly owned subsidiary of One Medical.
The proxy statement/prospectus described above will contain
important information about One Medical, Iora Health, the proposed
Merger and related matters. A proxy statement/prospectus will be
sent to all One Medical stockholders. One Medical also will file
other documents regarding the proposed transaction with the SEC.
Before making any voting decision, investors and security holders
of One Medical are urged to read the registration statement, proxy
statement/prospectus and all other relevant documents filed or that
will be filed with the SEC in connection with the proposed Merger
as they become available because they will contain important
information about the proposed Merger.
Investors and security holders will be able to obtain free
copies of these documents, and other documents filed with the SEC,
by One Medical through the website maintained by the SEC at
www.sec.gov. In addition, investors and security holders will be
able to obtain free copies of these documents from One Medical by
contacting One Medical’s Investor Relations by email at
investor@onemedical.com, or by going to the One Medical web page at
https://investor.onemedical.com and clicking on the links titled
“Financial Information” and “Investor Services.”
Participants in the Solicitation
The respective directors and executive officers of One Medical
and Iora Health may be deemed to be participants in the
solicitation of proxies from One Medical’s stockholders and written
consents from the security holders of Iora Health in connection
with the proposed Merger. Information regarding the interests of
these directors and executive officers in the transaction described
herein will be included in the proxy.
Forward-Looking Statements
This press release contains express and implied forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995, which include, but are not limited to,
statements regarding expected timing, completion and effects of the
proposed Merger. All statements contained in this press release
other than statements of historical facts, including business
strategy and plans and objectives for future operations, are
forward-looking statements. The words “anticipate,” “believe,”
“continue,” “estimate,” “expect,” “intend,” “can”, “may,” “assume,”
“project,” “will,” “plan,” and similar expressions are intended to
identify forward-looking statements. These forward-looking
statements are subject to a number of risks and uncertainties, and
you should not rely upon the forward-looking statements as
predictions of future events. The future events and trends
discussed in this presentation may not occur and actual results
could differ materially and adversely from those anticipated or
implied in the forward-looking statements as a result of
uncertainties, risks, and changes in circumstances, including but
not limited to risks and uncertainties related to: the ability of
the parties to consummate the proposed Merger, satisfaction of
closing conditions precedent to the consummation of the proposed
Merger, potential delays in consummating the Merger, the ability of
One Medical to timely and successfully achieve the anticipated
benefits and potential synergies of the Merger and the impact of
health epidemics, including the COVID-19 pandemic, on the parties’
respective businesses and the actions the parties may take in
response thereto; the strength of the One Medical brand; member
satisfaction with our services and support; anticipated membership
growth and revenue potential from our members; our ability to
retain members; our ability to successfully introduce and drive
adoption of new products; changes in the pricing we offer our
members; our relationships with our health network partners and
enterprise clients and any changes to, accommodations in or
terminations of our contracts with the health network partners or
enterprise clients; our ability to improve cost of care and
margins, including timing and expenses of new office openings and
entry into new geographic markets; changes in laws or regulations;
our involvement in litigation, including medical malpractice claims
and consumer class actions; any governmental investigations or
inquiries into our business and operations or challenges to our
relationships with the One Medical PCs under the administrative
services agreements; our strategic plan; our financial outlook; our
focus areas for investment and our investments; announcements by us
or our competitors of business or strategic developments; and our
overall business trajectory. Except to the extent required by law,
One Medical does not undertake to update any of these
forward-looking statements after the date of this press release to
conform these statements to actual results or revised expectations.
A discussion of factors that may affect future results, including
under the heading titled “Risk Factors”, is contained in One
Medical’s SEC filings, including the most recent Annual Report on
Form 10-K and Quarterly Report on Form 10-Q, which may be accessed
at www.sec.gov.
This press release may include certain non-GAAP financial
measures as defined by SEC rules. Because not all companies
calculate non-GAAP financial information identically (or at all),
the presentations herein may not be comparable to other similarly
titled measures used by other companies. Further, such non-GAAP
financial information should be considered in addition to, and not
as superior to or as a substitute for, the historical consolidated
financial statements prepared in accordance with GAAP.
About One Medical
One Medical is a membership-based and technology-powered primary
care platform with seamless digital health and inviting in-office
care, convenient to where people work, shop, live, and click. Our
vision is to delight millions of members with better health and
better care while reducing costs. Our mission is to transform
health care for all through our human-centered, technology-powered
model.
Headquartered in San Francisco, 1Life Healthcare, Inc. is the
administrative and managerial services company for the affiliated
One Medical physician-owned professional corporations that deliver
medical services in-office and virtually. 1Life and the One Medical
entities do business under the “One Medical” brand.
About Iora Health
Iora Health is building a different kind of health system to
deliver high impact relationship-based care. With a mission to
restore humanity to health care and a goal to transform healthcare
overall, Iora Health’s care model provides extraordinary service to
patients to ensure improved health outcomes while lowering overall
health costs. Our patients enjoy the benefits of better access to
care, office- and non-office-based encounters (e.g. phone, text
messages, and email), an accessible and transparent medical record,
and robust educational offerings. Our practices across the U.S.
enjoy the benefits of smaller panel sizes, closer relationships
with patients, and the opportunity to lead systemic change in
health care delivery while working with a true team.
One Medical Investor Contact:Rose Salzwedel,
One MedicalDirector of Investor
Relationsinvestor@onemedical.com206-331-2211
One Medical Media Contact:Kristina Skinner, One
MedicalSenior Director of External
Communicationspress@onemedical.com650-743-5187
Iora Health Media Contact:Kathleen Haley, Iora
HealthVice President of Communications & Patient
Experiencekathleen.haley@iorahealth.com617-545-5284
1Life Healthcare (NASDAQ:ONEM)
Historical Stock Chart
From Mar 2024 to Apr 2024
1Life Healthcare (NASDAQ:ONEM)
Historical Stock Chart
From Apr 2023 to Apr 2024