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Summary
- Canadian health care service provider WELL Health Technologies Corp has announced its plans to acquire medical equipment maker CRH Medical Corp on Monday, February 8.
- While WELL Health’s stocks were up over 21 per cent on Monday morning, CRH Medical shares reflected a growth of about 80 per cent (10AM EST).
- WELL Health CEO and Chairperson Hamed Shahbazi described the acquisition deal as “monumental”.
Stocks of Canadian health care service provider WELL Health Technologies Corp (TSX:WELL) surged after it announced plans to acquire medical equipment maker CRH Medical Corp (TSX:CRH) on Monday, February 8.
While WELL Health’s stocks were up over 21 per cent on Monday morning, CRH Medical shares reflected a growth of about 80 per cent (9:30AM EST).
In an official statement, WELL Health said that it will be buying all of CRH Medical’s shares at a price of US$ 4 per share, bringing the total purchase price to US$ 292.7 million and the transaction value to US$ 369.2 million.
Let’s take a closer look at these two companies’ profiles.
WELL Health Technologies Corp (TSX:WELL)
WELL Health CEO and Chairperson Hamed Shahbazi described the acquisition deal as “monumental” for the company as it will not only help “significant boost” its revenue and EBITDA positions, but also improve its operations in the United States.
WELL Health added that is has also signed agreements with a group of investors to raise proceeds of around C$ 295.5 million in a non-brokered offering , which will take place at a price of C$ 9.8 per share.
While the equity offering is set to close by February 15, while the acquisition is expected to be complete by 2021’s second.
Stocks of WELL Health have improved by nearly seven per cent in February so far and by over 80 per cent in the last six months.
©Kalkine Group 2021
CRH Medical Corp (TSX:CRH)
Once the deal goes through, CRH Medical Chairperson and CEO Dr Tushar Ramani is expected to continue heading the company. WELL Health, meanwhile, will look into digitizing and modernizing CRH Medical’s operations.
The closer of the acquisition deal will require the approval of at least two-thirds of CRH Medical’s shareholders, the company pointed.
CRH Medical’s stocks ballooned by over 248 per cent in February so far and by about 220 per cent this year.
