Dr. Essam Hamza reports
CLOUDMD TO ACQUIRE VISIONPROS, A RAPIDLY GROWING DIGITAL EYECARE PLATFORM WITH A ROBUST SUITE OF DIGITAL VISION CARE TOOLS
CloudMD Software & Services Inc. has signed a binding term sheet to acquire VisionPros, a vertically integrated digital eyewear platform that has serviced almost one million unique customers across North America.
VisionPros conveniently delivers contact lenses and glasses right to its customer's door, anywhere in North America, at a fraction of the cost of traditional retail optical stores. The highly scalable business model includes a rapidly growing, high margin e-commerce platform, subscription business and innovative suite of digital vision care tools. VisionPros offers a unique subscription offering, with flexible monthly billing options, as well as some of the lowest prices in North America. The multidisciplinary platform also includes a brick-and-mortar clinic, on-line/in-person dispensary, and a lens laboratory that manufactures and distributes lenses to eyecare partners for their own affordable KIND eyewear line.
VisionPros was founded by Dr. Jessy Manhas and is led by a team of eye doctors committed to providing patient-focused vision care and empowering practitioners through its disruptive tele-optometry technology. VisionPros' chief executive officer, Dr. Steven Lee, is a pioneer of the on-line vision tests in the market and developed the first on-line vision test platform, which remains the current standard in North America. Subsequently, Dr. Lee developed, patented and is launching a new best-in-class, advanced technology that will deliver the safest on-line vision tests. This technology is designed to ensure a significantly higher level of accuracy and authentication of scripts. As part of VisionPros' commitment to global eye health, the company has contributed to the Eyes for the World charity organization, founded by the principals of VisionPros and dedicated to restoring sight through glasses or surgery and to prevent blindness around the world. Amongst its contributions, Eyes for the World, has helped finance the construction and operation of two eye hospitals -- one in India and one in Jamaica.
VisionPros' digital platform shares many synergies with CloudMD's existing platform and provides significant opportunities for cross-selling and integration. The e-commerce platform gives CloudMD direct access to almost one million unique customer accounts and further secures the company's footprint across North America. VisionPros' revenue for calendar year 2020 surpassed $22-million with an adjusted earnings before interest, tax depreciation and amortization margin exceeding 10 per cent.
Dr. Essam Hamza, CEO of CloudMD, commented: "This is a significant acquisition for our business, which not only adds meaningful high-margin revenue, but also provides us with an established e-commerce platform and almost one million customer accounts. VisionPros' disruptive tele-optometry platform aligns with our vision of providing patient-focused, whole-person care and will allow us to leverage a number of our technologies and integrate our solutions into one seamless patient experience."
Dr. Steven Lee, CEO of VisionPros, commented: "We are extremely excited to partner with CloudMD and their physician-led team. They share our commitment to providing a patient-centric approach that empowers physicians and engages patients. Our shared vision and combined resources are valuable for us as we look to undertake our aggressive growth strategy. There are obvious synergies across both health-tech platforms, and we look forward to leveraging those synergies to revolutionize the current system and build a North American leader in health care delivery."
Terms of acquisition
In consideration for the purchase of 100 per cent of the outstanding securities of VisionPros, CloudMD has agreed to pay shareholders of VisionPros $30-million in cash, subject to a working capital adjustment, $30-million in common shares of the company at a deemed price by calculating the volume-weighted average trading price of the company's common shares for the 10 trading days prior to the execution of the binding term sheet and a performance-based earnout of up to $40-million, which is payable in cash or common shares of the company, at the discretion of CloudMD at the time of the earnout. The common shares will be subject to certain contractual restrictions on trading for a period of 18 months from the date of issuance. Additionally, the company will pay a 5-per-cent finders' fee to an arm's-length party in accordance with TSX Venture Exchange policy.
The acquisition is subject to customary closing conditions, including the execution of a definitive acquisition agreement and receipt of TSX-V approval.
About CloudMD Software & Services
CloudMD is digitizing the delivery of health care by providing a patient-centric approach, with an emphasis on continuity of care. The company offers software-as-a-service-based health technology solutions to health care providers across North America and has developed proprietary technology that delivers quality health care through a holistic offering including hybrid primary care clinics, specialist care, telemedicine, mental health support, educational resources and artificial intelligence. CloudMD currently services a combined ecosystem of over 500 clinics, almost 4,000 licensed practitioners and eight million patient charts across North America.
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