Full Press Release Details
Health and Livongo Merge to Create New Standard
Healthcare Delivery, Access and Experience
Purchase, NY and Mountain View, CA, August 5, 2020 -- Teladoc
Health (TDOC), the global leader in virtual care, and Livongo (LVGO), the leading Applied Health Signals company - today
announced that they have entered into a definitive merger agreement. This merger represents a transformational opportunity to improve
the delivery, access and experience of healthcare for consumers around the world. The highly complementary organizations will combine
to create substantial value across the healthcare ecosystem, enabling clients everywhere to offer high quality, personalized, technology-enabled
longitudinal care that improves outcomes and lowers costs across the full spectrum of health.
Under the terms of the agreement, which has been unanimously
approved by the Board of Directors of each company, each share of Livongo will be exchanged for 0.5920x shares of Teladoc Health
plus cash consideration of $11.33 for each Livongo share, representing a value of $18.5 billion based on the closing price of
Teladoc Health shares as of August 4, 2020. Upon completion of the merger, existing Teladoc Health shareholders will own approximately
58 percent and existing Livongo shareholders will own approximately 42 percent of the combined company.
The combination of Teladoc Health and Livongo creates a
global leader in consumer centered virtual care. The company will have expected 2020 pro forma revenue of approximately $1.3
billion, representing year over year pro forma growth of 85 percent. Demonstrating the power of the combined platform and the
scalability of the data driven and virtual ethos, the combined company is expected to have pro forma Adjusted EBITDA of over
$120 million for 2020.
"This merger firmly establishes Teladoc Health at the
forefront of the next-generation of healthcare," said Jason Gorevic, CEO of Teladoc Health. "Livongo is a world-class
innovator we deeply admire and has demonstrated success improving the lives of people living with chronic conditions. Together,
we will further transform the healthcare experience from preventive care to the most complex cases, bringing whole person'
health to consumers and greater value to our clients and shareholders as a result."
"This highly strategic combination will create the leader
in consumer-centered virtual care and provides a unique opportunity to further accelerate the growth of our data-driven member
platform and experience," said Glen Tullman, Livongo Founder and Executive Chairman. "By expanding the reach of Livongo's
pioneering Applied Health Signals platform and building on Teladoc Health's end-to-end virtual care platform, we'll
empower more people to live better and healthier lives. This transaction recognizes Livongo's significant progress and will
enable Livongo shareholders to benefit from long-term upside as the combined company is positioned to serve an even larger addressable
market with a truly unmatched offering."
Strategic and financial benefits of the combination
Leadership & Governance
Jason Gorevic, current
CEO of Teladoc Health, will be the CEO of the combined company. Led by Teladoc Health chairman, David Snow, the newly combined
Teladoc Health Board of Directors will be composed of eight members of the Teladoc Health Board and five members of the Livongo
Additional Transaction
The transaction is expected
to close by the end of Q4 2020, subject to regulatory and Teladoc Health and Livongo shareholder approvals and other customary
closing conditions. The newly combined company will be called Teladoc Health and will be headquartered in Purchase, New York.
Lazard served as exclusive
financial advisor to Teladoc Health and Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal advisor.
Morgan Stanley served
as exclusive financial advisor to Livongo and Skadden, Arps, Slate, Meagher & Flom LLP served as legal advisor.
Joint Conference Call
and Transaction Website
Livongo will host a joint conference call and webcast today, August 5th at 8:00 a.m. ET. The
call will be broadcast live and archived on the investor relations section of each company's website at teladochealth.com and livongo.com.
The participant dial-In numbers in the U.S. are (844) 437-4787 or (877) 389-2414, and (607) 598-0118 outside the U.S.
Presentation slides will also be available
on the webcast link and on both companies' investor relations pages on their websites, as well as through the joint
transaction website at teladochealthlivongo.transactionannouncement.com.
About Teladoc Health
Teladoc Health is transforming how people access and experience
healthcare. Recognized as the world leader in virtual care, Teladoc Health directly delivers millions of medical visits across
175 countries each year through the Teladoc Health Medical Group and enables millions of patient and provider touchpoints for
thousands of hospitals, health systems and physician practices globally. Ranked #1 among direct-to-consumer telehealth providers
in the J.D. Power 2019 U.S. Telehealth Satisfaction Study and Best in KLAS for Virtual Care Platforms for 2020, Teladoc Health
leverages more than a decade of expertise and real-time insights to meet the growing virtual care needs of consumers, healthcare
professionals, employers and health plans. For more information, please visit teladochealth.com or follow @TeladocHealth
Livongo empowers people with chronic conditions
to live better and healthier lives, beginning with diabetes and now including hypertension, weight management, diabetes prevention,
and behavioral health. Livongo pioneered the category of Applied Health Signals to offer Members clinically based insights that
focus on the whole person and make it easier to stay healthy. Using its AI+AI engine, Livongo's team of data scientists
aggregate and interpret substantial amounts of health data and information to create actionable, personalized and timely health
signals delivered to Livongo Members exactly when and where they need them. The Livongo approach delivers better clinical and
financial outcomes while creating a different and better experience for people with chronic conditions. For more information,
visit: www.livongo.com or engage with Livongo
on LinkedIn or Twitter.
Cautionary Note Regarding Forward-Looking Statements
This communication contains
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking
statements generally include statements regarding the potential transaction between Teladoc Health and Livongo, including any
statements regarding the expected timetable for completing the potential transaction, the ability to complete the potential
transaction, the expected benefits of the potential transaction (including anticipated synergies, projected financial
information and future opportunities) and any other statements regarding Teladoc Health's and Livongo's future
expectations, beliefs, plans, objectives, results of operations, financial condition and cash flows, or future events or
performance. These statements are often, but not always, made through the use of words or phrases such as
"anticipate," "intend," "plan," "believe," "project,"
"estimate," "expect," "may," "should," "will" and similar
expressions. All such forward-looking statements are based on current expectations of Teladoc Health's and
Livongo's management and therefore involve estimates and assumptions that are subject to risks, uncertainties and other
factors that could cause actual results to differ materially from the results expressed in the statements. Key factors that
could cause actual results to differ materially from those projected in the forward-looking statements include the ability to
obtain the requisite Teladoc Health and Livongo stockholder approvals; uncertainties as to the timing to consummate the
potential transaction; the risk that a condition to closing the potential transaction may not be satisfied; the risk that
regulatory approvals (including anticipated tax treatment) are not obtained or are obtained subject to conditions that are
not anticipated by the parties; potential litigation relating to the potential transaction that could be instituted against
Teladoc Health, Livongo or their respective directors; the effects of disruption to Teladoc Health's or Livongo's
respective businesses; restrictions during the pendency of the potential transaction that may impact Teladoc Health's
or Livongo's ability to pursue certain business opportunities or strategic transactions; the effect of this
communication on Teladoc Health's or Livongo's stock prices; transaction costs; Teladoc Health's ability to
achieve the benefits from the proposed transaction; Teladoc Health's ability to effectively integrate acquired
operations into its own operations; the ability of Teladoc Health or Livongo to retain and hire key personnel; unknown
liabilities; and the diversion of management time on transaction-related issues. Other important factors that could cause
actual results to differ materially from those in the forward-looking statements include the effects of industry, market,
economic, political or regulatory conditions outside of Teladoc Health's or Livongo's control (including public