The merger with the blank-cheque firm will help Clover Health become publicly-traded
Clover Health Investments has agreed to merge with special purpose acquisition company Social Capital Hedosophia Holdings Corp. III (SCH) in a cash-and-stock deal worth $3.7bn.
The merger will enable the US insurtech firm to become a publicly-traded company.
Founded in 2013, Clover Health is a Medicare Advantage insurance firm. It is said to cater to more than 57,000 members across seven states in the US.
The deal with SCH will support the insurtech company with significant capital to scale and improve health outcomes for seniors across the US.
SCH founder and CEO Chamath Palihapitiya said: “We need companies like Clover to help fix our broken healthcare system. The Company’s rapid growth is a testament to the effectiveness of its tech-enabled approach, which resonates powerfully with consumers and physicians alike.
“I believe Clover is uniquely positioned to disrupt the entire Medicare Advantage market as well as expand into new and exciting opportunities in Original Medicare.”
Clover Health, through its technology platform, is said to collect, structure, and analyse health and behavioural data for giving patients improved medical outcomes and lower costs.
Clover Assistant, the company’s flagship platform, has been designed to aggregate millions of relevant health data points such as claims, medical charts, and diagnostics. The collected data is synthesised with member-specific information by using machine learning.
According to the insurtech company, this gives actionable and customised insights to physicians at the point of care. Besides, the platform helps in giving suggestions for medications and dosages and also the need for tests or referrals.
Founders of Clover Health to continue to lead the business
Post-merger, the company’s management team headed by CEO and co-founder Vivek Garipalli and Andrew Toy, who is president and co-founder, will continue to lead the business.
Garipalli said: “I launched Clover eight years ago to fix fundamental flaws in our healthcare system, including unequal access, abysmal customer service and wasteful spending. Chamath and the SCH team are fervent believers and true champions of Clover’s mission to improve every life.
“Our philosophy is that everyone should be able to afford great healthcare. The Clover team empowers physicians to deliver the best possible outcomes for our members, and the Clover Assistant does just that by delivering vital clinical insights to physicians at the point of care.”
The deal, which is subject to SCH shareholders’ approval, regulatory approvals, and other customary closing conditions, is expected to close in the first quarter of 2021.