Babylon Health is to delist from the New York Stock Exchange (NYSE), as it moves ahead with its plans to merge with Swiss digital therapeutics firm MindMaze.
The move coincides with the revelation that Babylon was not in compliance with NYSE regulations, as its market capitalisation had fallen below the US$50m requirement.
Another issue was that the average closing price of the company’s ordinary shares on the NYSE had fallen below US$1.00 over a consecutive 30 trading-day period.
Babylon Health, a British health technology start up that was founded by Ali Parsa in 2013, was a pioneer in using AI for virtual doctor technology – a concept that has become increasingly important since the Covid pandemic.
“We want to make high-quality healthcare accessible and affordable for everyone on Earth,” Babylon states as its mission on its website.
In the UK, Babylon partnered with the NHS to create Babylon GP at Hand, and also worked with individual NHS Trusts to increase access to what it described as “a patient-centric, digital-first model of care”.
Some 100,000 NHS patients are believed to use the GP at Hand service.
The company also lists other partnerships, including one with Higi in the United States and another with the government of Rwanda.
By entering into the new deal with MindMaze and London-based credit fund AlbaCore Captial, which should go into effect next month, Babylon said “The company does not intend to undertake actions to cure the deficiencies described above and return to compliance with the NYSE continued listing standards, and has notified the NYSE of this decision”.
After seeing share value decline by more than 99%, since listing on the NYSE back at the height of the pandemic in 2021, the move may not be good news for remaining Babylon shareholders.
The company said in its release: “As a result, the company expects the NYSE to immediately suspend its Class A ordinary shares from trading on the NYSE under the ticker symbol “BBLN”, and for the Class A ordinary shares to transition to trading on the over-the-counter market.
“In addition, the company expects the NYSE to subsequently delist the Class A ordinary shares from the NYSE in accordance with its procedures,” Babylon said.
Looking ahead, the company said: “Babylon and MindMaze believe that the combined entity will form a powerful digital-first global AI-driven healthcare business that will help transform the industry from sick care to predictive and preventative healthcare”.
Babylon said the notice and the expected suspension of trading and subsequent delisting of the Class A ordinary shares from the NYSE “do not affect the business operations of the company and its subsidiaries, and will have no impact on the proposed transaction”.