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As part of a $4.2 billion blank check transaction listed in the United States, the American big data company Palantir has strategically acquired a stake in the British health company Babylon.
Babylon, which provides a series of healthcare services to 24 million patients through mobile apps, has agreed to merge with Alkuri Global, a special purpose acquisition company listed on the Nasdaq, and become the latest European technology company to refuse to be listed in London.
This transaction brings Babylon’s corporate value to US$3.6 billion, plus a total revenue of US$575 million. This includes $270 million in private placements from new investors such as Swedish bank Robur, Sectoral Asset Management, and controversial data analysis company Palantir, as well as existing investors such as Kinnevik and Alkuri Sponsors.
Babylon was founded in 2013 by British Iranian entrepreneur and former banker Ali Parsa, and developed the GP at Hand app, which allows British patients to access their NHS general practitioners virtually, acting as their digital primary care practice. The service now has approximately 90,000 patients, making it the largest general practitioner “practice” in England.
Babylon also signed contracts with South Korea’s Samsung and China’s Tencent. To raise funds As part of the US$550 million raised in August 2019, it came from Saudi Arabia’s sovereign wealth fund.
Last year, it was launched in the United States, and Parsa said that so far, the United States has accounted for more than 80% of its annual revenue. “Last year we achieved 80 million U.S. dollars in revenue, and this year our revenue will exceed 300 million U.S. dollars. We think we will achieve ebitda-level break-even in 2023,” he said, despite losses of 95 million in 2019 and 2020 GBP.
The new strategic investor Palantir is known for his work in the US defense and national security fields. Last year, he signed a contract with the British NHS to establish Covid “data storage” and manage the distribution of PPE and other medical equipment between British hospitals.
“Palantir has some of the technology… no one has brought it into the biology and healthcare fields,” Parsa said. “Their understanding of data and our understanding of healthcare can revolutionize our capabilities [together]. We want to take it. .. By constructing a digital twin of each of us, we can understand the daily biometric technology of the human body and be able to construct more proactive images. “
The number of exits from digital health companies in 2020 hit a record high, and it is expected to rise in 2021. According to data from CBInsights, in the first quarter of this year, 7 digital health companies have been listed through US Spacs.
However, Alkuri Global’s stock price has been below its net asset value and has hardly changed since the transaction was announced. Alkuri’s current share price of $9.85 is lower than the $10 per share that investors including Pipes bought into the transaction.
As increased regulatory review and poor performance have weakened investors’ confidence, a sharp “surge” in Spac’s stock after the acquisition announcement is relatively rare. At the height of the Spac boom in the first quarter of 2021, it is common for the stock price of blank check companies to rise by 80% or 90% based on trading rumors alone.
Parsa acknowledged that this is a difficult time for the Spac market and said that if it goes public six months ago, the company may see different results.
Babylon is the latest British technology group to be listed in the US through the Spac transaction.It follows in the footsteps of Arrival, the London-based electric car company began trading on the Nasdaq in late March After merging with CIIG Merger Corp, And the British used car dealer Cazoo, which is Listed Reached a USD 7 billion transaction with Ajax I listed in the United States.
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