The national telehealth provider SOC Telemed has announced a new deal for Access Physicians valued at $194 million upfront with additional potential consideration based on performance. Access Physicians is an experienced multi-specialty acute inpatient telemedicine provider focused on cardiac care, inpatient hospital care, tele-neurology, maternal-fetal expertise, tele-pulmonary and infectious disease management.
SOC Telemed (f.k.a Specialists On Call, Inc.) just went public over the summer through a reverse merger with Healthcare Merger Corp., a special purpose acquisition company. The deal valued SOC Telemed at $720 million, and institutional investors including BlackRock Inc., Baron Capital Group, and ClearBridge Investments committed to private investments of $165 million as part of the deal. The seller in that deal was Warburg Pincus, which bought SOC Telemed way back in 2014 for $32 million, according to search results in our Healthcare Deals Database. It seems like Warburg Pincus made a healthy return on its investment.
The combined company will deliver acute telemedicine to almost 1,000 facilities, including over 700 hospitals, across 47 states. This merger increases SOC Telemed’s national footprint, expands clinical service lines, and grows provider breadth and depth. The combined company is estimated to have approximately $107 to $113 million in pro forma annual revenue in 2021.
Just last week, SOC Telemed release its earnings report for the fourth quarter; revenue was $14.5 million compared to $16.6 million in the third quarter, a 13% decrease due to lower utilization of core services resulting from a decrease in hospital visits tied to the COVID-19 pandemic. Adjusted EBITDA was a loss of $3.9 million, compared to a positive $0.2 million in Q3, due to investments in its go-to-market functions. In 2021, the company is expected to have adjusted EBITDA ranging from $15 million to $19 million.