SelectQuote, Inc. (NYSE: SLQT) (the “Company”), a leading
distributor of Medicare insurance policies and owner of a
rapidly-growing healthcare services platform, today announced that
the Company signed a $350 million strategic investment from funds
managed by Bain Capital, Morgan Stanley Private Credit, and
Newlight Partners.
The transaction positions the Company to continue growing its
healthcare services business, deepening its relationship with
carrier partners and providing choice and value for consumers. This
investment will allow the Company to recapitalize its balance
sheet, to lower its annual cash debt service, and to provide
liquidity and increase operating flexibility to fund growth
initiatives. The Company’s successful renegotiation of its Senior
Secured Credit Facility provides a lower interest rate on the
remaining balance.
This investment will accelerate the Company’s effort to optimize
its capital structure as it continues to explore accretive,
strategic solutions with its insurance carrier partners and to grow
its rapidly expanding healthcare services business.
Additionally, SelectQuote is appointing Chris Wolfe of Bain
Capital and Srdjan Vukovic of Newlight Partners to the Board of
Directors, each bringing over 20 years of investing and healthcare
sector experience to the Company. SelectQuote anticipates Mr. Wolfe
and Mr. Vukovic will join the Board upon the closing of the
transaction, expected to be on February 28, 2025.
SelectQuote CEO Tim Danker commented, “This strategic investment
provides the financing we need to capitalize on the robust growth
opportunities we foresee in both the senior health insurance and
healthcare services marketplaces. While we have more work to do,
this deal, on the heels of our 2024 receivables securitization,
marks the second meaningful milestone toward our ultimate goal of
refinancing the business and significantly deleveraging the balance
sheet.”
Mr. Danker continued, “We look forward to benefitting from
Chris’s and Srdjan’s valuable growth-oriented healthcare expertise
to help augment the Company’s mission to drive long-term value
creation.”
Mr. Wolfe is a Managing Director at Bain Capital Insurance, the
dedicated insurance investing unit of Bain Capital. Previously, he
was a partner at Capital Z Partners and a principal in a series of
special purpose acquisition vehicles focused on health insurance
and services. Mr. Wolfe has more than 20 years of experience in
healthcare and insurance private equity investing.
“SelectQuote pioneered the way consumers approach shopping for
insurance by removing barriers and introducing transparency and
choice,” added Mr. Wolfe. “I am excited to partner with my fellow
board members and the Company’s management team to drive continued
growth of its robust insurance sales and healthcare services
solutions, which play a crucial role in safeguarding and enhancing
the financial well-being and health of its customers."
Mr. Vukovic is a Partner at Newlight Partners, where he focuses
on investments in the healthcare industry. Representative
investments include Oak Street Health (acquired by CVS Health) and
Zing Health. He has over 20 years of private equity investing
experience.
Ashwin Krishnan, Managing Director and Co-Head of North America
Private Credit at Morgan Stanley Investment Management stated, “We
are pleased to partner with SelectQuote and lead this financing
alongside our partners Bain Capital and Newlight. We believe this
investment, along with the Company’s recent operating momentum,
sets the business up for continued long-term success.”
Jefferies served as Exclusive Financial Advisor to SelectQuote
in the transaction. Wachtell, Lipton, Rosen & Katz served as
legal advisor to SelectQuote.
Forward Looking Statements
This release contains forward-looking statements. These
forward-looking statements reflect our current views with respect
to, among other things, future events and our financial
performance. These statements are often, but not always, made
through the use of words or phrases such as “may,” “should,”
“could,” “predict,” “potential,” “believe,” “will likely result,”
“expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,”
“intend,” “plan,” “projection,” “would” and “outlook,” or the
negative version of those words or other comparable words or
phrases of a future or forward-looking nature. These
forward-looking statements are not historical facts, and are based
on current expectations, estimates and projections about our
industry, management’s beliefs and certain assumptions made by
management, many of which, by their nature, are inherently
uncertain and beyond our control. Accordingly, we caution you that
any such forward-looking statements are not guarantees of future
performance and are subject to risks, assumptions and uncertainties
that are difficult to predict. Although we believe that the
expectations reflected in these forward-looking statements are
reasonable as of the date made, actual results may prove to be
materially different from the results expressed or implied by the
forward-looking statements.
There are or will be important factors that could cause our
actual results to differ materially from those indicated in these
forward-looking statements, including, but not limited to, the
following: our reliance on a limited number of insurance carrier
partners and any potential termination of those relationships or
failure to develop new relationships; existing and future laws and
regulations affecting the health insurance market; changes in
health insurance products offered by our insurance carrier partners
and the health insurance market generally; insurance carriers
offering products and services directly to consumers; changes to
commissions paid by insurance carriers and underwriting practices;
competition with brokers, exclusively online brokers and carriers
who opt to sell policies directly to consumers; competition from
government-run health insurance exchanges; developments in the U.S.
health insurance system; our dependence on revenue from carriers in
our senior segment and downturns in the senior health as well as
life, automotive and home insurance industries; our ability to
develop new offerings and penetrate new vertical markets; risks
from third-party products; failure to enroll individuals during the
Medicare annual enrollment period; our ability to attract,
integrate and retain qualified personnel; our dependence on lead
providers and ability to compete for leads; failure to obtain
and/or convert sales leads to actual sales of insurance policies;
access to data from consumers and insurance carriers; accuracy of
information provided from and to consumers during the insurance
shopping process; cost-effective advertisement through internet
search engines; ability to contact consumers and market products by
telephone; global economic conditions, including inflation;
disruption to operations as a result of future acquisitions;
significant estimates and assumptions in the preparation of our
financial statements; impairment of goodwill; potential litigation
and other legal proceedings or inquiries; our existing and future
indebtedness; our ability to maintain compliance with our debt
covenants; access to additional capital; failure to protect our
intellectual property and our brand; fluctuations in our financial
results caused by seasonality; accuracy and timeliness of
commissions reports from insurance carriers; timing of insurance
carriers’ approval and payment practices; factors that impact our
estimate of the constrained lifetime value of commissions per
policyholder; changes in accounting rules, tax legislation and
other legislation; disruptions or failures of our technological
infrastructure and platform; failure to maintain relationships with
third-party service providers; cybersecurity breaches or other
attacks involving our systems or those of our insurance carrier
partners or third-party service providers; our ability to protect
consumer information and other data; failure to market and sell
Medicare plans effectively or in compliance with laws; and other
factors related to our pharmacy business, including manufacturing
or supply chain disruptions, access to and demand for prescription
drugs, and regulatory changes or other industry developments that
may affect our pharmacy operations. For a further discussion of
these and other risk factors that could impact our future results
and performance, see the section entitled “Risk Factors” in the
most recent Annual Report on Form 10-K (the “Annual Report”) and
subsequent periodic reports filed by us with the Securities and
Exchange Commission. Accordingly, you should not place undue
reliance on any such forward-looking statements. Any
forward-looking statement speaks only as of the date on which it is
made, and, except as otherwise required by law, we do not undertake
any obligation to publicly update or review any forward-looking
statement, whether as a result of new information, future
developments or otherwise.
About SelectQuote:
Founded in 1985, SelectQuote (NYSE: SLQT) pioneered the model of
providing unbiased comparisons from multiple, highly-rated
insurance companies, allowing consumers to choose the policy and
terms that best meet their unique needs. Two foundational pillars
underpin SelectQuote’s success: a strong force of highly-trained
and skilled agents who provide a consultative needs analysis for
every consumer, and proprietary technology that sources and routes
high-quality leads. Today, the Company operates an ecosystem
offering high touchpoints for consumers across insurance, pharmacy,
and virtual care.
With an ecosystem offering engagement points for consumers
across insurance, Medicare, pharmacy, and value-based care, the
company now has three core business lines: SelectQuote Senior,
SelectQuote Healthcare Services, and SelectQuote Life. SelectQuote
Senior serves the needs of a demographic that sees around 10,000
people turn 65 each day with a range of Medicare Advantage and
Medicare Supplement plans. SelectQuote Healthcare Services is
comprised of the SelectRx Pharmacy, a Patient-Centered Pharmacy
Home™ (PCPH) accredited pharmacy, SelectPatient Management, a
provider of chronic care management services, and Healthcare Select
which proactively connects consumers with a wide breadth of
healthcare services supporting their needs.
About Bain Capital:
Founded in 1984, Bain Capital is one of the world’s leading
private investment firms. We are committed to creating lasting
impact for our investors, teams, businesses, and the communities in
which we live. As a private partnership, we lead with conviction
and a culture of collaboration, advantages that enable us to
innovate investment approaches, unlock opportunities, and create
exceptional outcomes. Our global platform invests across five focus
areas: Private Equity, Growth & Venture, Capital Solutions,
Credit & Capital Markets, and Real Assets. In these focus
areas, we bring deep sector expertise and wide-ranging
capabilities. We have 24 offices on four continents, more than
1,850 employees, and approximately $185 billion in assets under
management. To learn more, visit www.baincapital.com. Follow
@BainCapital on LinkedIn and X (Twitter).
About Newlight Partners:
Newlight Partners LP is a growth-focused private equity firm
that builds businesses in partnership with exceptional founders and
management teams. Newlight’s thematic investment approach focuses
on identifying and addressing marketplace opportunities in rapidly
growing subsectors. Areas of focus include digital transformation,
decarbonization, financial services, and healthcare.
About Morgan Stanley Private Credit:
Morgan Stanley Private Credit, part of Morgan Stanley Investment
Management, is a private credit platform focused on direct lending
and opportunistic private credit investment in North America and
Western Europe. The Morgan Stanley Private Credit team invests
across the capital structure, including senior secured term loans,
unitranche loans, junior debt, structured equity and common equity
co-investments. For further information, please visit the website:
morganstanley.com/im/private-credit
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version on businesswire.com: https://www.businesswire.com/news/home/20250210433873/en/
Investor Relations: Sloan Bohlen 877-678-4083
investorrelations@selectquote.com Media: Matt Gunter 913-286-4931
matt.gunter@selectquote.com
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