CloudMD Announces Closing of MindBeacon Acquisition
CloudMD Software & Services Inc., a healthcare technology company transforming the delivery of care, is pleased to announce the successful completion of the previously announced acquisition of MindBeacon Holdings Inc., one of North America’s leading providers of digital mental health care, pursuant to a court-approved plan of arrangement. Pursuant to the Arrangement, former MindBeacon shareholders are entitled to receive $1.22 of cash plus 2.285 common shares of CloudMD for each common share of MindBeacon. Following completion of the Arrangement, CloudMD has 287,675,749 common shares issued and outstanding, of which approximately 19.1% are owned by former MindBeacon shareholders.
MindBeacon’s robust digital mental healthcare platform, combined with its network of over 500 licensed therapists and advanced clinical psychologists, offers a full continuum of care centered around providing users the freedom to choose how, when and where they engage with support.
“We are thrilled to close the acquisition of MindBeacon, and would like to thank their shareholders, directors and management for the support and collaboration during this process. By uniting CloudMD and MindBeacon’s platforms, we will create a leading, fully-integrated health offering that provides effective stepped care across the entire spectrum of physical and mental healthcare,” said Dr. Essam Hamza, CEO of CloudMD. “The acquisition is expected to accelerate our U.S expansion strategy, a key focus for us in 2022, and improve organic growth by opening new distribution channels and through cross-selling to our 5,500 corporate clients. In addition, we have identified significant cost savings and are excited to integrate MindBeacon’s team and operations to realize further synergies between the businesses. Finally, I’d like to thank our shareholders and key stakeholders who have supported CloudMD’s vision and journey. I am looking forward to 2022 and our continued growth and transformation.”
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MindBeacon pioneered the digital delivery of evidence-based therapy through a computer or mobile device. As a result, over 50,000 people have been treated by MindBeacon’s therapist assisted internet-based cognitive behavioural therapy, receiving help 5 times faster than traditional community mental health care1. MindBeacon’s TAiCBT delivers impressive outcomes, with 82% of clients reporting self-improvement in mental health, and 67% reporting clinically significant improvement.
“As the need for accessible mental health support continues to grow, it is imperative that the sector innovates to increase accessibility, improve results and reduce costs. The progression of our Integrated Health Services Platform, our partnership with employers, advisors and insurers and the acquisition of MindBeacon, demonstrates our dedication to being a leader in innovating the mental health space,” said Karen Adams, President of CloudMD. “MindBeacon has one of the best clinically-proven solutions in the market today and by adding it to our platform, we can offer a broad range of synchronous and asynchronous services in a cost-effective, stigma-reducing way that meets patients when and where they need. We will be integrating MindBeacon and all our mental health solutions to support individuals at work, off work or returning to work.”
“CloudMD’s Comprehensive Integrated Health Services Platform is the perfect home for MindBeacon’s mental health capabilities. Together, we’re an industry-leading holistic health company,” said Sam Duboc, Former Executive Chair of MindBeacon. “I’m thrilled that this opportunity will be able to positively impact our patients and I’d like to thank our shareholders for their overwhelming support and recognition of how much more we will be able to accomplish together.”
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The addition of MindBeacon to CloudMD’s holistic offering positions the Company as a leader within the fast-growing global behavioural healthcare market, which is expected to grow to US$242 billion by 2027, with a compounded annual growth rate of 5.02% between 2020 and 20272. The acquisition is expected to be synergistic by offering the following benefits:
- Combined, the digital health platform is expected to be one of North America’s leading fully-integrated health offerings, with a clinically-validated, broad continuum of care to address mild, moderate, acute and chronic mental and physical care.
- Integration into CloudMD’s Comprehensive Integrated Health Services Platform will expand the breadth of interactive technologies and tool sets within behavioural health to support clients with longitudinal multi-dimensional care.
- Data interoperability and increased analytic touchpoints will provide additional valuable data around healthcare outcomes and improve network effects.
- Significant cross-selling opportunities through a combined network of 5,500 corporate clients, over 5 million lives, and extensive government contracts.
- Drive U.S. expansion through additional capabilities, modalities, cross-selling opportunities and MindBeacon’s recent acquisition of a U.S.-based mental health provider.
- MindBeacon’s “Beacon in a Box” white label iCBT SaaS offering complements CloudMD’s Digital Health Solutions division and may be sold directly to its network of over 20,000 regulated healthcare professionals.
- Overall cost synergies, including MindBeacon, now exceed $4 million.
The companies have already started to integrate MindBeacon’s healthcare solutions into CloudMD’s broad continuum of care. Management anticipates that the acquisition will generate significant run-rate synergies beginning in the first quarter of this year. Such synergies are expected to be realized through cost rationalization, process integration and the scale of the combined organization. The complementary nature of the combined digital health offering is also expected to fuel product cross-selling opportunities to existing CloudMD and MindBeacon clients.
In connection with closing of the Arrangement, CloudMD expanded its management team to include John Plunkett (MindBeacon’s former Chief Financial Officer) as EVP, Transformation and Strategic Planning and Adam Kelly (MindBeacon’s former President and Chief Commercial Officer) as Chief Commercial Officer, with both positions reporting to Karen Adams.
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