Back in 2015, Montrealers George Favvas and Jean-Sébastien Boulanger set off to the city by the bay in search of fame and fortune, and founded a Medtech business called Circle Medical. 5 short years later, their business is operating in 35 states, and soon to be in Canada as well. This tele-health business offers patients access to primary care doctors over video, and works with most major US insurers.
Over the years these local boys have graduated from Y Combinator and raised more than $12 million from a vast combination of investors with seemingly different priorities, except for one. Making fat stacks!
Good news for them.
Earlier this week Vancouver’s WELL Health Technologies (TSX: WELL), agreed to acquire a majority of the outstanding shares of Circle Medical for approximately 14M USD. Under the terms of the Agreement, WELL plans two concurrent transactions. First, they will acquire Circle Medical shares in exchange for common shares in WELL in the amount of about $9M USD at a deemed price per WELL share of $4.77 CAD (Note that the stock has gone up about 20% since the transaction was announced). Next, WELL has agreed to acquire $5M USD worth of Circle Medical shares from Circle Medical’s treasury adding primary funds to treasury for purposes of growth and scale. The remaining issued and outstanding securities of Circle Medical will be retained by the original securityholders, who will continue to operate Circle Medical after the deal is sealed.
“We are excited at the prospect of partnering with WELL to help us rapidly scale our telehealth technology and grow market share in the United States,” said George Favvas, Co-Founder and CEO of Circle Medical. “Our patient-centric app has not only delivered great experiences but also improved outcomes. We have a compelling development road map ahead that will continue to empower patients to better health. Given the unprecedented circumstances with the COVID-19 pandemic, we believe now more than ever is the time to innovate and create exceptional healthcare experiences.”
“This proposed transaction is expected to position WELL as a leading provider of telehealth services in the United States. Since WELL’s seed investment in Circle Medical almost two year ago, we’ve closely tracked the company and their seamless omni-channel patient experience. Our research and proximity to the company showed us that Circle Medical is delivering exceptional service exemplified by impressive NPS scores in the healthcare industry. We believe they are by extension, one of the best primary care and telehealth providers in the US,” said Hamed Shahbazi, Chairman & CEO of WELL. “We are looking forward to expanding our relationship with the talented Circle Medical team.”