After shareholders approved the deal on Thursday, Teladoc completed its acquisition of Livongo, in a deal that would value the digital health company at $18.5 billion. It closed just a little less than three months after the two companies announced they had reached an agreement in August.
Both companies’ shareholders overwhelmingly voted to approve the merger. In total, Teladoc’s shareholders will own 58% of the combined company, and Livongo’s shareholders will own 42%.
Per the terms of the deal, Livongo shareholders will get 0.59 shares of Teladoc stock and $11.33 in cash for each Livongo share, including a $7.09 per share dividend.
The merger would combine Livongo’s platform for managing chronic conditions, such as diabetes and heart disease, with telemedicine. The two businesses are expected to be complementary, with Livongo’s platform offering a way to keep patients engaged in between telehealth visits. They also have little overlap between their current customers — only 25%.
The companies said the combination has already started to draw in interest. In mid-October, they announced they had made their first combined sale to the parent company of Florida Blue Cross, Guidewell Health.
“Both Teladoc Health and Livongo were founded with the same mission: to create a new kind of healthcare experience, one that empowers people everywhere to live their healthiest life. Today’s news dramatically accelerates our ability to make this a reality for the tens of millions of consumers and healthcare professionals we serve around the world,” Teladoc CEO Jason Gorevic said in a news release. “Together, our team will achieve the full promise of whole-person virtual care, leveraging our combined applied analytics, expert guidance and connected technology to deliver, enable and empower better health outcomes.”
As disclosed in an earlier filing, some of Livongo’s top executives resigned with the close of the merger. They include CEO Zane Burke, CFO Lee Shapiro, President Jennifer Schneider and Executive Chairman Glen Tullman.
Schneider and Tullman are working with General Catalyst to create a blank-check company. The goal is to raise $500 million to take a healthcare technology company public.
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