RE:News
Well Health to acquire Trinity Healthcare for $7.22M
2019-11-21 20:47 ET - News Release
Mr. Hamed Shahbazi reports
WELL HEALTH TO ACQUIRE TRINITY HEALTHCARE TECHNOLOGIES, CANADA'S SECOND LARGEST OSCAR PROVIDER
Well Health Technologies Corp. has entered into an arm's-length share purchase agreement dated Nov. 21, 2019, with the direct and indirect shareholders of Oscarservice Inc., doing business as Trinity Healthcare Technologies (THT), whereby the company has, indirectly, agreed to acquire all of the issued and outstanding shares of THT.
The total consideration payable by WELL in connection with the acquisition of THT is approximately $7,225,000 consisting of the following: (i) $4,696,250 paid in cash upon closing of the Transaction; (ii) $1,445,000 paid in common shares in the capital of WELL at a price of approximately $1.39 per share, being equal to the five day volume-weighted average trading price of WELL's common shares, subject to the policies of the TSX Venture Exchange (the "TSXV"); and (iii) a time based earn-out of $1,083,750 paid in equal quarterly installments over 2 years. The Transaction will be financed with cash on hand.
"We are excited to welcome the talented team at THT to the WELL Family. As Canada's second largest OSCAR service provider, THT will be a key asset in our consolidation of the OSCAR EMR marketplace and substantially increases our footprint in Ontario with over 500 clinics in its service portfolio," said Hamed Shahbazi, Chairman and CEO of WELL. "THT is our fifth planned acquisition in Canada's OSCAR EMR marketplace and further solidifies our position as the third largest EMR service provider in Canada supporting over 8,000 healthcare practitioners and their operations."
THT, founded in 2007, is a provider of OSCAR based EMR software and services and is based out of Mississauga, Ontario. THT is a leading clinical software and solution provider focused on digitizing the communication and workflow between a physician's office and the rest of the healthcare system. Beside general EMR supporting primary care, THT has also demonstrated strong success in providing EMR services to specialists in areas of Ophthalmology and Fertility. THT's success in supporting such specialists is due to its innovative approach in providing deep customizations that improve clinic workflow and efficiency.
"We are delighted with the opportunity to join the WELL EMR Group, who has very quickly become the largest OSCAR EMR vendor in Canada," said Toby Bian, CEO of THT. "WELL's vision, growth strategy and professional team appealed to us and we believe our physician and clinic customers will benefit from their focus on empowering doctors and patients with advanced digital health solutions".
In the last twelve months, THT has generated more than $2M in revenues, the vast majority of which is high margin recurring subscription revenue, with solid double digit EBITDA3 margins. THT has more than 2,280 physicians and healthcare practitioners using its solutions. With the previously announced acquisition of OSCARwest and the proposed acquisition of THT, WELL is expecting it will increase its EMR business to approximately 1,446 healthcare clinics servicing over 8,280 physicians and healthcare practitioners across Canada.
The transaction is subject a number of closing conditions, including certain corporate and regulatory approvals, such as approval from the TSXV. All shares issued in the Transaction will be issued pursuant to an exemption from applicable securities laws and as such will be subject to a restricted period of four months and one day. There are no finder's fees payable in connection with the Transaction. WELL anticipates that the Transaction will constitute an Expedited Acquisition in accordance with the policies of the TSXV.
OSCAR, an acronym for "Open Source Clinical Application Resource", was developed by McMaster University Department of Family Medicine to inspire collaboration between the wide spectrum of health professionals with the goal to drive downstream benefits to patient care.
This figure includes the proposed acquisition of OSCARwest which was announced by WELL on September 25, 2019
EBITDA is a Non-GAAP measure. Earnings before interest, taxes, depreciation and amortization ("EBITDA") should not be construed as alternatives to net income/loss determined in accordance with IFRS. EBITDA does not have any standardized meanings under IFRS and therefore may not be comparable to similar measures presented by other issuers. The Company believes that EBITDA is a meaningful financial metric as it measures cash generated from operations which the Company can use to fund working capital requirements, service future interest and principal debt prepayments and fund future growth initiatives.