- London-based digital health startup Babylon will go private as part of a deal with investment manager AlbaCore Capital Group and its affiliates, the company announced Wednesday. Babylon will receive $34.5 million in interim funding in addition to an amendment of its $300 million loan agreement from AlbaCore.
- Babylon posted a $63 million loss for the first quarter of 2023, compared with a loss of $29.1 million in the first quarter of 2022. The company’s NYSE stock price was cut in half Thursday, dropping from $2.05 to around $1.28 a share.
- AlbaCore plans to help the company with its long-term restructuring process, including developing a long-term employee incentive plan for Babylon.
The news is a reversal of course for Babylon. The company went public in October 2021 in a merger with special purpose acquisition company Alkuri Global Acquisition Corp. SPAC deals accelerated during the pandemic to help digital health companies raise money and coincided with an increase in telehealth use during that time.
Founded in 2013, Babylon offers integrated primary care along with remote consultations with doctors on the web or via a mobile app. It uses artificial intelligence to power virtual diagnoses and medical appointments.
Babylon will receive the interim funding in May or early June if it meets certain conditions, according to the company.
The virtual care company is also exploring a sale of the Meritage Medical Network/Independent Physician Association business. Meritage offers in-person care for close to 90,000 members and more than 12 insurers in Northern and Central California. The sale allows Babylon to focus on its core mission of virtual care.
“The sale of our IPA business and streamlining of our reporting and governance processes will result in a more focused business, simpler structure and stronger balance sheet,” Ali Parsa, Babylon’s founder and CEO, said in an October 2022 statement.