As Babylon Health’s proposed sale to Swiss digital therapeutics firm MindMaze collapses, the tech firm says there will be no impact on the services it provides as the tech firm seeks “new strategic alternatives” for its UK business.
According to the company’s website in the UK, the tech firm partnered with the NHS to create Babylon GP at Hand, and has been “working with individual NHS Trusts to increase access to a patient-centric, digital-first model of care”.
In September of last year Bupa extended its partnership agreement with Babylon for a further three years to deliver digital health services to the insurer’s customers.
Health & Protection understands there should be no impact on the services Babylon Health provides to NHS GP at Hand, direct-to-consumer or private patients and members as it pursues options for its UK business.
Health & Protection also understands Babylon Health intends to continue to uphold the highest standards of care and service for patients and members and is committed to continuing its day to day operations and innovating its technology capabilities.
Health & Protection further understands Babylon has reopened its GP at Hand list to patients effective 7 August 2023 and is in active discussions with a number of potential investors and partners to secure the financial future and continuity of the UK operation, either as a standalone entity or in partnership with another body.
At the end of June, Babylon Health announced plans to delist from the New York Stock Exchange (NYSE), as it moved ahead with its plans to merge with MindMaze.
But in a filing issued on Monday (7 August) the firm revealed that its proposed deal announced on 23 June 2023 involving MindMaze and their European credit investment firm AlbaCore Capital Group will now no longer proceed.
New strategic alternatives
Babylon is now exploring new strategic alternatives for its UK business and to exit from its core US business.
Babylon said that following its receipt of funding under its amended bridge notes facility with AlbaCore and has no binding commitment for additional financing to continue its business operations.
Consequently, it is exploring new strategic alternatives in order to find the “best possible outcome for its UK business”.
According to the statement, the company said it “remains focused on continuing the day to day operations of its UK business, providing accessibility of its healthcare services and the highest standards of care for its patients and members” and is “pursuing the divestiture of its UK business to third parties that may provide financing to assure the continuity of the operations”.
But Babylon said it cannot provide assurance that any of these initiatives will result in it entering into a definitive agreement for completing a sale.
Across the Atlantic
Across the Atlantic, Babylon said it is exiting its core US business and plans to safely transition its US members to other providers, while continuing to pursue a third party sale.
In order to explore these opportunities for such a sale and enable business continuity, Babylon is in discussions with potential strategic partners to secure additional funding.
But Babylon warned it cannot provide assurance that it will be able to secure sufficient liquidity to fund the operations of the group’s businesses.
It added to the extent that Babylon is unable to secure additional financing and complete a third party sale of a particular business, the applicable entities of the group will file for bankruptcy protection or implement other alternatives for an orderly wind down and liquidation or dissolution.
That may include commencing Chapter 7 proceedings under the US Bankruptcy Code and/or a UK administration for the applicable entities of the group in the near term.
It added that any third party sale will be subject to AlbaCore’s rights under its debt agreements with Babylon, but that the aggregate proceeds of any such sales are not expected to exceed the total amount of the group’s indebtedness to AlbaCore.
As a result, any such transaction will not provide for any payment to Babylon’s Class A ordinary shareholders and other equity instrument holders.