WELL Health Technologies announced that on April 16, shareholders of CRH Medical Corporation (CRH) voted in favor of WELL’s acquisition of CRH for $4 per share in cash.
This is WELL Health’s (WELL) largest acquisition to-date, with a transaction value of approximately $369.2 million. The deal is expected to close on or around April 22. CRH Medical provides products and services to gastroenterologists throughout the United States.
WELL Health Chairman and CEO Hamed Shahbazi said, “Once the acquisition is completed, CRH represents a significant opportunity for WELL as it will significantly boost WELL’s revenue, and profitability and provides, WELL with additional inorganic and organic growth opportunities including a meaningful channel of over 3000 physicians to offer its digital tools, tech enablement and data protection services.”
Shahbazi added that CRH should help WELL generate meaningful cash flow for several years and allow for a greater allocation of capital towards interesting healthcare-technology segments.
At closing, subscription receipts from the previously announced C$302.5 million equity offering will be exchanged for common shares of WELL. (See WELL Health Technologies stock analysis on TipRanks)
Two weeks ago, Desjardins analyst David Newman reiterated a Buy rating on the stock with a C$13.15 price target (85% upside potential).
Newman said WELL may seek to raise more capital in order to fund more acquisitions. The digital health company recently expanded its presence in Ontario by acquiring Ottawa-based healthcare provider ExecHealth.
Overall, WELL Health stock scores a Strong Buy consensus rating based on 6 Buys. The average analyst price target of C$11.83 implies upside potential of about 66% to current levels. Shares have plunged more than 10% over the last month.