Benefytt Technologies, Inc. (NASDAQ: BFYT) (“Benefytt”) (“the
Company”), a health insurance technology company and leading
distributor of Medicare-related health insurance plans, today
announced that it has entered into a definitive agreement to be
acquired by funds affiliated with Madison Dearborn Partners, LLC
(the “MDP Funds”), a leading private equity firm based in Chicago
that has deep experience in the insurance technology and health
care industries. The all-cash transaction is structured as a tender
offer of $31.00 per share that will commence in the coming days,
followed immediately by a merger.
Gavin Southwell, Benefytt’s Chief Executive Officer and
President, said, “Over the past year, our Board of Directors and
management team have evaluated numerous strategic options to
maximize shareholder value and to position the company for its
strategic transformation. Following this comprehensive review, we
believe Madison Dearborn is the right partner to deliver compelling
and certain value to our shareholders. This transaction marks a new
stage for the entire Benefytt team, and we look forward to moving
ahead with a focus on continuing to offer innovative,
technology-enabled services to the people and markets we
serve.”
The announced transaction with the MDP Funds is the culmination
of a process led by Benefytt’s Board of Directors since July 26,
2019, to explore, review and evaluate a range of potential
strategic alternatives for the Company. The tender offer price per
share represents a 59% premium over the 30-day volume-weighted
average price per share of Benefytt’s common stock through the
close of trading on July 10, 2020.
The Company’s Board has unanimously approved the acquisition of
the Company by the MDP Funds. Following the successful tender of at
least a majority of the then outstanding shares of the Company’s
common stock, the MDP Funds will acquire any remaining outstanding
shares of Benefytt’s Class A common stock through a merger at a per
share price equal to the tender offer price.
“Benefytt’s technology-driven model has positioned it well in
the evolving Medicare market and we believe we can help Gavin and
his team continue to advance Benefytt’s product offering and
service model,” said Vahe Dombalagian, a Managing Director on the
Madison Dearborn Financial & Transaction Services team. “Our
team has built an extensive resource network and brings significant
industry experience, which we look forward to leveraging to support
Benefytt. We are pleased to be able to help the Benefytt team
fulfill the Company’s mission to connect consumers with health
insurance and supplemental products that provide people with added
security and peace of mind.”
Following completion of the transaction, Benefytt will become a
private company, substantially owned by the MDP Funds, and will no
longer be traded on Nasdaq Global Select Market. Benefytt’s
management team, including Chief Executive Officer Gavin Southwell,
is expected to continue to lead the Company. The Company plans to
maintain its operations in Tampa, Fla.
The closing of the acquisition is expected to occur in the third
quarter of this year, subject to the successful tender of a
majority of the then outstanding shares of Benefytt’s common stock
and the satisfaction of other customary closing conditions.
Weil, Gotshal & Manges LLP is serving as legal advisor to
Benefytt and BofA Securities is acting as exclusive financial
advisor. Kirkland & Ellis LLP is serving as legal advisor to
the MDP Funds and SunTrust Robinson Humphrey, Inc. is acting as
financial advisor. Committed financing for the transaction is being
provided by Truist Bank.
About Benefytt Technologies, Inc.
Benefytt Technologies, Inc. is a health insurance technology
company that primarily engages in the development and operation of
private e-commerce health insurance marketplaces, consumer
engagement platforms, agency technology systems, and insurance
policy administration platforms. By leveraging existing and
emerging platforms and Technologies, the Company offers a range of
Medicare-related insurance plans from many of the nation’s leading
carriers as well as other types of health insurance and
supplemental products that meet the needs of consumers.
About Madison Dearborn Partners, LLC
Madison Dearborn Partners, LLC ("Madison Dearborn") is a leading
private equity investment firm based in Chicago. Since Madison
Dearborn’s formation in 1992, the firm has raised aggregate capital
of over $26 billion and has completed over 140 investments. Madison
Dearborn invests across five dedicated industry verticals,
including financial and transaction services; health care; basic
industries; business and government software and services; and
telecom, media and technology services. For more information,
please visit www.mdcp.com.
Additional Information and Where to Find It
The tender offer described in this communication has not yet
been commenced. This announcement and the description contained
herein is neither an offer to purchase nor a solicitation of an
offer to sell shares of the Company. At the time the tender offer
is commenced, Daylight Beta Parent Corp. (“Parent”), a corporation
affiliated with the MDP Funds, and Daylight Beta Corp., a wholly
owned Subsidiary of Parent, intend to file a Tender Offer Statement
on Schedule TO containing an offer to purchase, forms of letters of
transmittal and other documents relating to the tender offer
(collectively, the “Tender Offer Documents”), and the Company
intends to file a Solicitation/Recommendation Statement on Schedule
14D-9 (the “Recommendation Statement”) with respect to the tender
offer. Parent and the Company intend to mail these documents to the
Company’s stockholders at no expense to the Company’s stockholders.
Investors and security holders of the Company are urged to
carefully read the Tender Offer Documents and the Recommendation
Statement, each as may be amended or supplemented from time to
time, and any other filings made in connection therewith when they
become available before making any decision with respect to the
tender offer because such documents will contain important
information about the proposed transactions and the parties
thereto.
Investors and security holders of the Company will be able to
obtain a free copy of the Tender Offer Documents and the
Recommendation Statement and any supplements or amendments thereto,
as well as other relevant filings, including materials that are
incorporated by reference into those documents, without charge, at
the SEC’s website (http://www.sec.gov) or from the Company by
contacting the Company’s Investor Relations at (813) 906-5314, by
email at mdevries@bfyt.com, or by going to the Company’s Investor
Relations page on its website at http://investor.benefytt.com and
clicking on the link titled “Financial Information.”
Cautionary Note on Forward Looking
Statements
The matters discussed in this communication may constitute
forward-looking statements. These statements involve known and
unknown risks, uncertainties, and other factors that may cause our
actual results, activity levels, performance or achievements to be
materially different from any future results, activity levels,
performance or achievements expressed or implied by such
forward-looking statements. In some cases, you can identify these
statements by forward-looking words such as “could”, “expect”,
“estimate”, “may”, “potential”, “will”, and “would”, or similar
words. You should read statements that contain these words
carefully because they discuss our future expectations, contain
projections of our future results of operations or of our financial
position, or state other forward-looking information. There may be
events in the future that we are not able to predict or control
accurately, and numerous factors may cause events, our results of
operations, financial performance, achievements, or industry
performance, to differ materially from those reflected in the
forward-looking statements.
In addition to factors previously disclosed in the Company’s
reports filed with securities regulators in the United States and
those identified elsewhere in this communication, the following
factors, among others, could cause actual results to differ
materially from forward-looking statements and information or
historical performance: the occurrence of any event, change or
other circumstances that could give rise to the right of one or
both of the Company and Parent to terminate the definitive merger
agreement between the Company and Parent; the outcome of any legal
proceedings that may be instituted against the Company, Parent or
their respective shareholders or directors; the ability to obtain
regulatory approvals and meet other conditions to the consummation
of the tender offer and the other conditions set forth in the
merger agreement, including the risk that regulatory approvals
required for the merger are not obtained or are obtained subject to
conditions that are not anticipated or that are material and
adverse to the Company’s business; a delay in closing the merger;
business disruptions from the proposed tender offer and merger that
harm the Company’s business, including current plans and
operations; potential adverse reactions or changes to business
relationships resulting from the announcement or completion of the
tender offer or merger; certain restrictions during the pendency of
the tender offer or merger that may impact the Company’s ability to
pursue certain business opportunities or strategic transactions;
the ability of the Company to retain and hire key personnel; and
the business, economic and political conditions in the markets in
which the Company operates. For a more detailed discussion of
these factors, also see the information under the captions “Risk
Factors” and “Management's Discussion and Analysis of Financial
Condition and Results of Operations” in the Company’s most recent
report on Form 10-K for the year ended December 31, 2019, and in
each case any material updates to these factors contained in any of
the Company’s future filings.
As for the forward-looking statements and information that
relate to future financial results and other projections, actual
results will be different due to the inherent uncertainties of
estimates, forecasts and projections and may be better or worse
than projected and such differences could be material. Given these
uncertainties, you should not place undue reliance on these
forward-looking statements, which apply only as of the date of this
communication. Subsequent events and developments may cause our
views to change. While we may elect to update the forward-looking
statements at some point in the future, we specifically disclaim
any obligation to do so. Annualized, pro forma, projected and
estimated numbers are used for illustrative purpose only, are not
forecasts and may not reflect actual results.
Contacts
For Benefytt Technologies, Inc.: Michael
DeVries Senior Vice President, Finance
813-906-5314mdevries@bfyt.com
For MDP: Abernathy MacGregor Chuck Dohrenwend
or Deirdre Walsh 212-371-5999 AbmacMDCP@abmac.com
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