Clover Health, the US-based health insurer that counts internet technology conglomerate Alphabet as an investor, agreed yesterday to a reverse merger with a special purpose acquisition company.
The transaction will involve Clover taking the New York Stock Exchange listing secured by Social Capital Hedosophia Holdings Corp III (SCH) when it floated in April this year in a $720m initial public offering.
The deal is set to value Clover at $3.7bn and provide it with about $1.2bn in proceeds, including $828m in SCH’s account and $400m in private investment in public equity financing.
The latter will come from backers including Hedosophia, investment and financial services group Fidelity, Senator Investment Group, Casdin Capital, Perceptive Advisors, funds affiliated with Jennison, and SCH founder and CEO Chamath Palihapitiya.
Clover provides health insurance through a model that utilises its technology to source and study health and behavioural data in a bid to support medical treatment while lowering costs.
The company had raised a total of $925m in funding, most recently securing $500m in a January 2019 round led by investment firm Greenoaks Capital.
Alphabet’s GV unit had joined Greenoaks Capital, Palm Drive Capital, Western Technology Investment, Sequoia Capital and First Round Capital in a $130m series D round two years earlier that valued Clover at $1.2bn.
First Round and Sequoia took part as existing investors, and Clover’s earlier backers include Social Capital, the VC firm founded by Palihapitiya, as well as Casdin, Arena Ventures, Wildcat Ventures, AME Cloud Ventures, Floodgate, Nexus Ventures, Spark Capital and Refactor Capital.
