Thursday, November 25, 2021

Clinigence Holdings And Nutex Health Announce Transformational Merger

Clinigence Holdings, Inc. a leading technology-enabled, risk-bearing population health management company, and Nutex Health, LLC (together with its affiliates, “Nutex”), one of the largest independent operators of micro-hospitals and hospital outpatient departments in the United States, today announced that they have signed a definitive merger agreement pursuant to which the companies will combine in a stock-for-stock merger transaction.

Based in Houston, Texas and founded in 2011 by Chairman and CEO Tom Vo, M.D., MBA, Nutex currently owns and operates nineteen facilities in eight states. Nutex currently targets to add another two Nutex micro-hospitals to become operational as early as December 2021, while twelve additional facilities are under construction and are expected to become operational in 2022. Nutex has approximately 1500 employees nationwide and is partnered with approximately 200 physicians.  Nutex micro-hospitals provide 24/7 care, including emergency room care, inpatient care, and behavioral health, and offer a range of services including onsite imaging services such as CT scans, x-ray and ultrasound, as well as certified and accredited laboratories that provide immediate results, and onsite inpatient pharmacies.  Numerous Nutex hospitals have been voted and awarded “Best Hospitals” in their respective communities.

Under the terms of the merger agreement, each unit representing an equity interest in Nutex issued and outstanding immediately prior to the closing date shall be converted into the right to receive approximately 3.571 shares of common stock of Clinigence Holdings, as adjusted as set forth in the merger agreement.  The aggregate number of shares to be issued to Nutex equity holders in the transaction will depend on the amount of equity in micro-hospital subsidiaries contributed by Nutex equity holders prior to the merger. It is currently anticipated that Nutex equity holders prior to the merger will own, after the merger, approximately 90% of the shares of common stock of Clinigence, on a fully diluted basis.  The newly combined company will be renamed Nutex Health, Inc. and headquartered in Houston, Texas.  The transaction has been approved by the Board of Directors of Clinigence and approved by the manager and equity holders of Nutex.

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Upon closing of the transaction, Tom Vo, M.D., MBA will serve as Chairman and Chief Executive Officer of the combined company.  Warren Hosseinion, M.D., the current CEO of Clinigence Holdings, will serve as President of the combined company.  The Board of Directors of the combined company will consist of Dr. Vo, Dr. Hosseinion and other appointees of Nutex.

“We are excited to announce this strategic merger with Nutex Health to create one of the nation’s leading providers of healthcare services,” stated Warren Hosseinion, M.D., Chairman, Chief Executive Officer and Co-Founder of Clinigence Holdings.  “Our two organizations complement each other and will allow us to advance our integrated care delivery platform, which would include technology-enabled, risk-bearing value-based provider networks wrapped around efficient micro-hospitals.”

“Both of our organizations have a history of providing high-quality, concierge level care that is cost effective and focused on outcomes and high patient satisfaction,” stated Tom Vo, M.D., MBA, Chairman, Chief Executive Officer and Founder of Nutex Health. “We are proud to say that we have made a huge difference in the lives of not just the patients and the community that we serve, but also to the lives of the doctors and team members that work with us.  We are excited about the future of the combined company.”

Approvals

The transaction, which is expected to close in the first half of 2022, is subject to a number of conditions, including antitrust regulatory clearance, approval by Clinigence stockholders, conditional approval for listing on Nasdaq of the common stock of Clinigence and other customary closing conditions.  There can be no assurance that the Company will be able to consummate the merger with Nutex.

Advisors

The Benchmark Company and Colliers are acting as financial advisors to Clinigence.  McDermott, Will & Emery is serving as legal counsel to Clinigence.  Ernst & Young Capital Advisors is acting as an exclusive financial advisor to Nutex, WG Consulting LLC is acting as pre-audit advisor to Nutex and Locke Lord LLP is serving as legal counsel to Nutex.

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