AmWell Expects to Raise $560 Million Through its IPO

As the COVID-19 pandemic continues to affect millions worldwide, more patients than ever areĀ using telehealth services for care – avoiding overcrowded emergency rooms and physician practices in favor of virtual consults.

Venture Capitalists have recognized the potential and have funded telehealth companies to the tune of $2 billion just in the first half of 2020.

Teladoc, the only pure play telehealth company, has done well with its stock up over 158% this year, and interest for Initial Public Offerings (IPOs) has spiked after the merger between Livongo (stock up about 448% this year) and Telehealth.

AmWell is the latest telehealth company looking to capitalize on the momentum in the market for virtual care companies. It is offering 35 million of its Class A common shares priced between $14 and $16. The company expects to raise about $560 million through its IPO.

Upon completing the offering, the company will have three classes of common stock, Class A, Class B, and Class C common stock.

The company founders Ido Schoenberg and Roy Schoenberg will hold 51% of Class B common stock.

Recently, AmWell agreed to issue $100 million of its Class C common stock to Google, with the price per share equal to the public’s purchase price in this offering and represents Google’s interest in Amwell of approximately 3.03% of common stock on a fully diluted basis.

The company reported revenue of $148.9 million in 2019 compared to $114 million in 2018, a 30.6% increase year-over-year. The company incurred net losses of $52.3 million in 2018 and $88.4 million in 2019.

Recent IPO Activity

Amwell is one of many digital health companies currently looking to go public.

More recently, GoodRx, an online pharmacy platform that helps consumers compare medication prices and discounts, filed with the SEC for its IPO.

Specialists On Call (dba SOC Telemed), a telemedicine technology provider, agreed to be acquired for $720 million and taken public by Healthcare Merger Corporation, a special purpose acquisition company. Accolade, a startup that helps workers navigate their health benefits and dealings with insurance companies, has hired banks including Goldman Sachs and Morgan Stanley to advise ahead of a possible IPO. MDLive is also preparing to go public next year, the company’s chief executive officer told STAT.

Of the 29 digital health public companies Mercom tracks, 13 companies outperformed the S&P 500 Index in 2020 (YTD).

Image Credit: AmWell


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