MIAMI, Nov. 12, 2020 /PRNewswire/ -- Cano Health,
LLC ("Cano Health" or the "Company"), a leading value-based
care delivery platform for seniors, and Jaws Acquisition
Corp. (NYSE: JWS), a special purpose acquisition
company, announced today they have entered into a definitive merger
agreement that will support Cano Health's vision of becoming
America's leader in primary care for seniors. Upon completion of
the transaction, the combined company will operate as Cano Health,
and will be listed on the New York Stock Exchange (NYSE) under the
new ticker symbol "CANO."
Founded in 2009, Cano Health provides value-based care for more
than 103,000 members through its network of 564 primary care
physicians across 14 markets in Florida, Texas, Nevada
and Puerto Rico. The Company
focuses on providing high-touch population health and wellness
services to Medicare Advantage members, particularly in underserved
communities where it can make the greatest impact. Cano Health's
proprietary CanoPanorama technology platform enables the delivery
of high-quality health care services to its members, resulting in
superior clinical outcomes at lower costs. Cano Health partners
with leading health plans, including Humana, UnitedHealthcare,
Anthem, Aetna, Centene and Devoted, to improve health outcomes and
member experience.
Cano Health is one of the fastest growing providers of
value-based care to Medicare Advantage populations in the nation,
which is expected to be a $590
billion market in 2025. The Company has executed on a
multi-pronged strategy of organic growth through existing centers,
de novo clinics, and MSO affiliate practices, as well as growth
through acquisitions to drive a historical revenue compound annual
growth rate of over 70% since 2017. In addition, Cano Health was
selected to participate as a Direct Contracting Entity by the
Centers for Medicare and Medicaid Services (CMS) under the
"American Choice Healthcare, LLC" brand that is scheduled to
commence in April 2021 and has the
potential to significantly expand the Company's addressable
market.
The transaction will further accelerate Cano Health's growth and
enable the expansion of its value-based care into new geographies.
The Company is expected to receive up to $935 million in transaction proceeds to pay down
debt and provide growth capital, and a substantial majority of up
to $465 million of proceeds is
expected to be allocated to Cano Health's financial sponsor.
Cano Health's management team, led by Founder and CEO Dr.
Marlow Hernandez, will continue to
lead the Company following the transaction. Barry Sternlicht, Co-Founder and Chairman of
Jaws Acquisition Corp., will serve on the Company's Board of
Directors.
Management Comments
"The team at Jaws Acquisition Corp. recognizes our dedication to
clinical and operational excellence and we are incredibly excited
to partner with them to pursue numerous growth opportunities," said
Dr. Hernandez. "We have fulfilled and will always remain faithful
to our mission – to improve patient health and quality of life by
delivering superior primary care medical services, while forging
life-long bonds with our members. We truly believe our model is
transformative and can lead to fundamental improvements in
America's healthcare system, while helping Americans who need our
help the most. In the process, we are revitalizing entire
communities. Over the last ten years, we have watched our platform
deliver results that benefit patients, providers and payors. At
Cano Health, we understand the fundamental problems with
traditional healthcare payment models. That's why we continue to
align incentives and help providers achieve profitability while
providing superior medical care. Today, we take a big step in our
effort to make healthcare in America more accessible, coordinated
and affordable."
"Cano Health's mission of providing high-quality healthcare to a
largely underserved population resonates with the principles of
Jaws Acquisition Corp., which include doing well by doing good"
said Mr. Sternlicht. "Cano Health has an exceptional, highly
experienced management team led by Dr. Hernandez, and is incredibly
well positioned to capitalize on the large and growing opportunity
being driven by the government's shift to Medicare Advantage and
demographic tailwinds in the market. We are pleased to partner with
Cano Health and provide the Company with the capital needed to
accelerate the next phases of its growth to become one of the
leading primary care providers in the country."
"We are thrilled with how Cano Health has grown to become the
leader in value-based healthcare for underserved seniors and look
forward to watching it continue to expand nationwide," said
Elliot Cooperstone, Managing Partner
of InTandem Capital Partners, Cano Health's financial sponsor since
2016.
Key Transaction Terms
The transaction values the combined company at an enterprise
value of approximately $4.4 billion
and implies a multiple of 3.1x estimated 2021 revenues of
$1.45 billion.
The business combination is expected to deliver up to
$1.49 billion of gross proceeds,
including the contribution of up to $690
million of cash held in Jaws Acquisition Corp.'s trust
account and an $800 million
concurrent private placement (PIPE) of common stock of the combined
company, priced at $10.00 per share.
The PIPE includes $50 million from
Barry Sternlicht and the remainder
from leading institutional investors, including funds affiliated
with Fidelity Management & Research Company, funds and accounts
and accounts managed by BlackRock, Third Point and Maverick
Capital. Existing Cano Health shareholders will roll over
approximately 90% of their equity stake into the new company.
Assuming no public shareholders of Jaws Acquisition Corp.
exercise their redemption rights and after $465 million in cash consideration to Cano
Health's existing shareholders, Cano Health shareholders will own
approximately 65%, Jaws Acquisition Corp. shareholders will own
approximately 15%, PIPE investors will own approximately 17% and
Jaws' sponsor will own approximately 4% of the issued and
outstanding shares of common stock, respectively, of the combined
company at closing. Furthermore, the combined company will be
capitalized with up to $535 million
in cash, including proceeds received from the transaction and after
paydown of approximately $400 million
in debt.
The transaction, which has been unanimously approved by Cano
Health and Jaws Acquisition Corp., is subject to approval by Jaws
Acquisition Corp.'s shareholders and other customary closing
conditions. The transaction is expected to close at the end of the
first quarter or the beginning of the second quarter of 2021.
A more detailed description of the transaction terms and a copy
of the Business Combination Agreement will be included in a current
report on Form 8-K to be filed by Jaws Acquisition Corp. with the
United States Securities and Exchange Commission (the "SEC"). Jaws
Acquisition Corp. will file a registration statement (which will
contain a proxy statement prospectus) with the SEC in connection
with the transaction.
Advisors
Moelis & Company is acting as financial advisor to Cano
Health.
Credit Suisse is serving as financial advisor and exclusive
capital markets advisor to Cano Health. Credit Suisse is also
serving as exclusive placement agent on the private offering.
Goodwin Procter LLP is serving as legal counsel to Cano Health
and Cravath Swaine & Moore LLP is serving as counsel to certain
shareholders, including members of Company management.
Kirkland & Ellis LLP is serving as legal counsel to Jaws
Acquisition Corp.
Management Presentation
A presentation made by the management of Cano Health and Jaws
Acquisition Corp. regarding the transaction will be available
on Jaws Acquisition Corp.'s website https://www.jawsholdings.com/
and Cano Health's website https://canohealth.com/. In connection
with this event, Jaws Acquisition Corp. will file an investor
presentation with the SEC, which can be viewed at www.sec.gov.
About Cano Health, LLC
Cano Health operates primary care centers and supports
affiliated medical practices in Florida, Texas, Nevada, and Puerto
Rico that specialize in value-based care for seniors. As
part of its care coordination strategy, Cano Health provides
high-touch population health management programs such as wellness
activities, pharmacy services, home visits, telehealth, transition
of care, and high-risk and complex care management.
The Company's personalized patient care and proactive approach
to wellness and preventive care is what sets it apart from
competitors. In August 2020, Cano
Health was ranked the 6th fastest growing healthcare
company in the country on the Inc. 5000 list.
About Jaws Acquisition Corp.
Jaws Acquisition Corp., led by Chairman Barry S. Sternlicht and Chief Executive Officer
Joseph L. Dowling, is a blank check
company incorporated as a Cayman
Islands exempted company for the purpose of effecting a
merger, share exchange, asset acquisition, share purchase,
reorganization or similar business combination with one or more
businesses or entities.
Additional Information
In connection with the proposed business combination, Jaws
intends to file with the SEC a registration statement on Form S-4,
which will include a preliminary proxy prospectus and preliminary
proxy statement. Jaws will mail a definitive proxy statement/final
prospectus and other relevant documents relating to the proposed
business combination to its shareholders. This press release is not
a substitute for the registration statement, the definitive proxy
statement/final prospectus or any other document that Jaws will
send to its shareholders in connection with the business
combination. Investors and security holders of Jaws are advised to
read, when available, the proxy statement/prospectus in connection
with Jaws' solicitation of proxies for its extraordinary general
meeting of shareholders to be held to approve the business
combination (and related matters) because the proxy
statement/prospectus will contain important information about the
business combination and the parties to the business combination.
The definitive proxy statement/final prospectus will be mailed to
shareholders of Jaws as of a record date to be established for
voting on the business combination. Shareholders will also be able
to obtain copies of the proxy statement/prospectus without charge,
once available, at the SEC's website at www.sec.gov, or by
directing a request to: 1601 Washington Avenue, Suite 800,
Miami Beach, Florida, 33139.
Participants in the Solicitation
Jaws, the Company and their respective directors, executive
officers, other members of management, and employees, under SEC
rules, may be deemed participants in the solicitation of proxies of
Jaws' shareholders in connection with the business combination.
Investors and security holders may obtain more detailed information
regarding the names and interests in the business combination of
Jaws' directors and officers in Jaws' filings with the SEC,
including the registration statement to be filed with the SEC by
Jaws, which will include the proxy statement of Jaws for the
business combination, and such information and names of the
Company's managers and executive officers will also be in the
registration statement to be filed with the SEC by Jaws, which will
include the proxy statement of Jaws for the business
combination.
No Offer of Solicitation
This press release is for informational purposes only and is
neither an offer to purchase, nor a solicitation of an offer to
sell, subscribe for or buy any securities or the solicitation of
any vote in any jurisdiction pursuant to the business combination
or otherwise, nor shall there be any sale, issuance or transfer or
securities in any jurisdiction in contravention of applicable law.
No offer of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act.
Forward-Looking Statements
Certain statements made herein are not historical facts but are
forward-looking statements for purposes of the safe harbor
provisions under The Private Securities Litigation Reform Act of
1995. Forward-looking statements generally are accompanied by words
such as "believe," "may," "will,"
"estimate," "continue," "anticipate,"
"intend," "expect," "should," "would,"
"plan," "predict," "potential," "seem,"
"seek," "future," "outlook" and similar
expressions that predict or indicate future events or trends or
that are not statements of historical matters. These
forward-looking statements include, but are not limited to,
statements regarding future events, the business combination
between Jaws and the Company, the estimated or anticipated future
results and benefits of the combined company following the business
combination, including the likelihood and ability of the parties to
successfully consummate the business combination, future
opportunities for the combined company, and other statements that
are not historical facts.
These statements are based on the current expectations of Jaws'
management and are not predictions of actual performance. These
forward-looking statements are provided for illustrative purposes
only and are not intended to serve as, and must not be relied on,
by any investor as a guarantee, an assurance, a prediction or a
definitive statement of fact or probability. Actual events and
circumstances are difficult or impossible to predict and will
differ from assumptions. Many actual events and circumstances are
beyond the control of Jaws and the Company. These statements are
subject to a number of risks and uncertainties regarding Jaws'
businesses and the business combination, and actual results may
differ materially. These risks and uncertainties include, but are
not limited to, general economic, political and business
conditions; the inability of the parties to consummate the business
combination or the occurrence of any event, change or other
circumstances that could give rise to the termination of the
business combination agreement; the outcome of any legal
proceedings that may be instituted against the parties following
the announcement of the business combination; the receipt of an
unsolicited offer from another party for an alternative business
transaction that could interfere with the business combination; the
risk that the approval of the shareholders of Jaws or the Company
for the potential transaction is not obtained; failure to realize
the anticipated benefits of the business combination, including as
a result of a delay in consummating the potential transaction or
difficulty in integrating the businesses of Jaws and the Company;
the risk that the business combination disrupts current plans and
operations as a result of the announcement and consummation of the
business combination; the ability of the combined company to grow
and manage growth profitably and retain its key employees; the
amount of redemption requests made by Jaws' shareholders; the
inability to obtain or maintain the listing of the post-acquisition
company's securities on NYSE following the business combination;
costs related to the business combination; and those factors
discussed in Jaws' final prospectus relating to its initial public
offering, dated May 13, 2020, and
other filings with the SEC. There may be additional risks that Jaws
presently does not know or that Jaws currently believes are
immaterial that could also cause actual results to differ from
those contained in the forward-looking statements. In addition,
forward-looking statements provide Jaws' expectations, plans or
forecasts of future events and views as of the date of this
communication. Jaws anticipates that subsequent events and
developments will cause Jaws' assessments to change. However, while
Jaws may elect to update these forward-looking statements at some
point in the future, Jaws specifically disclaims any obligation to
do so. These forward-looking statements should not be relied upon
as representing Jaws' assessments as of any date subsequent to the
date of this communication. Accordingly, undue reliance should not
be placed upon the forward-looking statements.
This press release contains certain financial forecast
information of Cano Health. Such financial forecast information
constitutes forward-looking information, and is for illustrative
purposes only and should not be relied upon as necessarily being
indicative of future results. The assumptions and estimates
underlying such financial forecast information are inherently
uncertain and are subject to a wide variety of significant
business, economic, competitive and other risks and uncertainties.
See "Forward-Looking Statements" above. Actual results may differ
materially from the results contemplated by the financial forecast
information contained in this press release, and the inclusion of
such information in this press release should not be regarded as a
representation by any person that the results reflected in such
forecasts will be achieved.
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SOURCE Jaws Acquisition Corp.; Cano Health, LLC