SOC Telemed (TLMD) stock roars 342% higher after purchase offer

February 03, 2022 09:36 AM PST | By Rupam Roy

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SOC Telemed (TLMD) stock roars 342% higher after purchase offer — Image source: janews,shutterstock

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Highlights

SOC Telemed has entered into a definitive agreement to be acquired by Patient Square Capital.

Telemed shareholders will receive US$3 in cash for each Class A common stock.

The transaction is expected to close in the second quarter of fiscal 2022.

The SOC Telemed, Inc. (NASDAQ:TLMD) stock skyrocketed by over 342% in the premarket on Thursday after Patient Square Capital offered to purchase the telemedicine company.

Telemed on Thursday said that it entered into a definitive agreement with Patient Square Capital to be acquired by the healthcare investment firm.

The Virginia-based Telemed provides services to hospitals, healthcare clinics, and other related organizations. Its Telemed IQ platform offers healthcare solutions.

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Telemed- Patient Square Deal

Under the terms of the agreement, Telemed shareholders will receive US$3 in cash for each Class A common stock. The price represents a premium of 366% on Wednesday’s closing price. Its six-day volume-weighted average price (VWAP) rose around 93% as of February 2.

The Telemed Board of Directors unanimously approved the deal. It has asked the shareholders to approve the merger agreement. Meanwhile, they are likely to meet at an upcoming meeting.

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Telemed shareholders own around 39% of the outstanding shares of Class A common stock.

The shareholders are expected to vote on the merger agreement. Steve Shulman, Chairman of the Board of Directors, said the acquisition would benefit the shareholders.

He added that an independent committee of the board and financial and legal advisors have thoroughly reviewed the offer and responded favorably to the decision.

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SOC Telemed will be a private firm after the transaction is closed. CEO Chris Gallagher, who took charge in September 2021, will continue in his role. He said Telemed would have the flexibility and resources to continue spending on clinical developments.

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Bottomline

Telemed said it has a 30-day "go-shop" period, which allows the company to consider offers from other parties. The deal is expected to close in the second quarter of 2022, depending on the final approval of Telemed shareholders. The TLMD stock traded at US$2.85 at 9:07 is ET on February 3, up 342.82% from its previous close.

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