Deerfield Healthcare Technology Acquisitions (DFHT), a special purpose acquisition company sponsored by an affiliate of Deerfield Management Company, and Richard Barasch, a veteran healthcare public company executive and investor, closed a business combination with CareMax Medical Group and IMC Medical Group Holdings (IMC), creating a platform providing care and chronic disease management to seniors. As previously announced, the transaction was approved at a special meeting of DFHT’s stockholders on June 4.
The business combination was partially funded by $125 million in debt financing through a $185 million senior secured credit facility for which RBC Capital Markets and Truist Securities acted as joint leading arrangers and joint bookrunners. The business combination also was funded by approximately $144 million in cash held in the DFHT trust account and more than $400 million through a private placement in public equity including Deerfield, Fidelity Management & Research, Eminence Capital, funds and accounts managed by BlackRock and Maverick Capital. Total cash consideration payable to the equity holders of CareMax Medical Group and IMC was approximately $229.4 million and $85.2 million, respectively, net of debt and subject to ordinary adjustments, representing approximately 68% and 45%, respectfully, of the value of each business.
The combined company, which has been renamed CareMax, expects that its Class A common stock and public warrants will commence trading on the Nasdaq Global Select Market under the new trading symbols “CMAX” and “CMAXW,” respectively, starting on June 9.
Immediately following closing, CareMax will own and operate 26 multi-specialty medical centers throughout South Florida. CareMax recently signed definitive agreements for four acquisitions, which it believes will be accretive. Two of these acquisitions recently closed and the remaining two acquisitions are subject to customary closing conditions and are expected to close during Q2/21.
Carlos de Solo will continue to lead CareMax as CEO, with William Lamoreaux serving as executive vice president, Kevin Wirges serving as CFO, Niberto Moreno, MD, serving as chief medical officer, Albert de Solo serving as chief operating officer and Ben Quirk serving as chief strategy officer.
“On behalf of the team at DFHT and Deerfield, I am very pleased to announce the closing of this business combination,” Barasch, who will serve as executive chairman of CareMax, said. “The CareMax team has created a foundational senior-focused healthcare delivery platform that combines high-touch patient care, vertical care coordination and delivery and a highly scalable technology backbone. We believe this differentiated model facilitates members receiving the right care at the right time in the most efficient setting. CareMax has become the platform of choice for payors, providers and patients. Working collaboratively, we believe that the success that CareMax has experienced regionally can be replicated to other markets across the country.”
“We look forward to this next, exciting phase of our growth as a public company,” Carlos de Solo said. “We created the CareMax platform to address a fundamental flaw in our nation’s healthcare system: the current fee-for-service business model is failing the elderly and the taxpayer. By interceding early on the primary care level, we have demonstrated that we can improve patient outcomes and lower senior healthcare spending through the prevention and management of chronic disease. We expect to grow organically and via acquisition while remaining focused both on providing the highest level of patient care and delivering long-term shareholder value. We believe our pipeline for acquisitions remains robust, as providers seek to align themselves with our model of value-based care.”
Deutsche Bank Securities and UBS Investment Bank acted as financial advisors and capital markets advisors to DFHT. Morgan Stanley acted as financial advisor to CareMax Medical Group and Piper Sandler acted as financial advisor to IMC. DLA Piper acted as legal advisor to CareMax Medical Group, McDermott Will & Emery acted as legal advisor to IMC, White & Case and Polsinelli acted as legal advisors to DFHT and Katten Muchin Rosenman acted as legal advisor to Deerfield.
