ShareCare acquired by Altaris: fairness opinion by Houlihan Lokey and MTS Health Partners
Deal terms
Implied value per share by method vs. $1.43 offer
Ranges as disclosed in the banker’s summary of analyses; the red line marks the per-share consideration.
Opinion of Houlihan Lokey to the special committee
Discounted cash flow assumptions
Houlihan Lokey also reviewed management estimates of NOLs and Estimated NOL Tax Savings.
Selected public companies (7)
Accolade, Inc. · Alight, Inc. · American Well Corporation · Evolent Health, Inc. · Health Catalyst, Inc. · Phreesia, Inc. · Teladoc Health, Inc.
| Multiple | Peer low | Peer median | Peer high | Range applied | Implied per share |
|---|---|---|---|---|---|
| EV / CY2024E Revenue | 0.9x | 1.1x | 2.8x | 1.0x–1.8x | $1.04–$1.82 |
| EV / CY2025E Revenue | 0.8x | 1.0x | 2.4x | 0.8x–1.3x | $0.97–$1.65 |
| EV / CY2024E Adj. EBITDA | 6.2x | 10.6x | 13.2x | 11.0x–13.0x | $0.64–$0.88 |
| EV / CY2025E Adj. EBITDA | 5.5x | 8.2x | 14.8x | 7.0x–10.0x | $1.08–$1.60 |
Other analyses
| Analysis | Summary | Implied per share |
|---|---|---|
| Selected Transactions Analysis (not relied upon) | Houlihan Lokey did not rely upon a review of publicly available financial terms of other transactions because it did not identify a sufficient number of relevant transactions in which the acquired companies were sufficiently similar to Sharecare. | — |
| Historical stock trading review | Reviewed current and historical market prices and trading volume for Sharecare's publicly traded securities and those of other relevant companies. | — |
| Prior preliminary sum-of-the-parts analysis (March 15, 2024 discussion materials) | Preliminary sum-of-the-parts valuing Sharecare's enterprise, provider and life sciences segments separately, netted against present value of corporate overhead (perpetual growth 1.0%-2.0%, discount rates 11.0%-12.0%). Applied 1.50x-2.50x CY2024E enterprise segment revenue, 8.0x-15.0x CY2024E provider segment adj. EBITDA and 10.0x-14.0x CY2024E life sciences segment adj. EBITDA, based on selected transaction sets (enterprise: TV/NFY revenue low 1.21x, high 8.08x, median 3.42x, mean 4.00x; provider: TV/NFY adj. EBITDA low 13.8x, high 14.7x, median 14.1x, mean 14.2x; life sciences: TV/NFY adj. EBITDA low 8.9x, high 16.2x, median 10.2x, mean 11.8x). | — |
| Prior illustrative leveraged buyout analysis and future share price analysis (October 2023 Board materials) | October 2023 discussion materials for the Sharecare Board included an illustrative leveraged buyout analysis, an illustrative discounted cash flow analysis and an illustrative analysis of the future price of Sharecare Common Stock. | — |
Transaction fee based on value of the Merger, currently estimated at approximately $8,100,000, contingent upon consummation (elsewhere described as a success-based fee equal to 1.5% of total transaction value). $1,000,000 opinion fee payable on delivery of opinion, 50% creditable against the Transaction Fee. Also entitled to a break-up fee equal to 20% of any termination/break-up fee received by Sharecare, capped at 50% of the Transaction Fee. Houlihan Lokey received approximately $3.1 million in aggregate compensation from the Altaris Group in the prior two years, including acting as financial advisor to the special committee of Trean Insurance Group in its going private transaction with Altaris.
Opinion of MTS Health Partners to the special committee
Discounted cash flow assumptions
Implied enterprise value range of $420 million to $690 million; per share value derived by deducting net debt and the $50 million Sharecare Preferred Stock liquidation preference. Compared to implied enterprise value of the Surviving Corporation of $534 million.
Selected public companies (11)
HealthEquity, Inc. · R1 RCM Inc. · Alight, Inc. · Evolent Health, Inc. · Progyny, Inc. · Craneware plc · HealthStream, Inc. · Definitive Healthcare Corp. · Accolade, Inc. · Health Catalyst, Inc. · OptimizeRx Corporation
| Multiple | Peer low | Peer median | Peer high | Range applied | Implied per share |
|---|---|---|---|---|---|
| EV / 2024E Adjusted EBITDA | — | — | — | 11.7x–18.3x | $0.75–$1.10 |
| EV / 2025E Adjusted EBITDA | — | — | — | 9.0x–14.2x | $1.45–$2.15 |
Selected precedent transactions (11)
| Date | Target | Acquirer | Multiple |
|---|---|---|---|
| 2023-09-05 | NextGen Healthcare, Inc. | Thoma Bravo | — |
| 2022-11-01 | Benefitfocus, Inc. | Voya Financial, Inc. | — |
| 2022-10-03 | Bswift LLC | Francisco Partners | — |
| 2022-06-21 | Convey Health Solutions Holdings, Inc. | TPG Capital | — |
| 2022-06-16 | LifeWorks Inc. | TELUS Corporation | — |
| 2022-04-05 | Tivity Health Inc. | Stone Point Capital | — |
| 2021-01-06 | Change Healthcare | Optum | — |
| 2020-10-27 | Health Advocate | Teleperformance SE | — |
| 2019-12-20 | Care.com, Inc. | IAC Inc. | — |
| 2017-07-24 | WebMD Health Group Corp. | KKR (Internet Brands Inc.) | — |
| 2016-10-21 | Everyday Health, Inc. | Ziff Davis, LLC | — |
| Multiple | Low | Median | High | Range applied | Implied per share |
|---|---|---|---|---|---|
| EV / Adjusted LTM EBITDA (applied to Sharecare 2024E Adjusted EBITDA) | — | — | — | 12.3x–16.3x | $0.75–$1.00 |
Other analyses
| Analysis | Summary | Implied per share |
|---|---|---|
| Sharecare Historical Stock Price Performance (informational only) | For the period June 22, 2023 to June 20, 2024, Sharecare Common Stock traded as low as $0.48 and as high as $1.80; closing price on June 20, 2024 was $0.77. Implied fully diluted equity value range over the period of $150 million to $700 million. 30-trading-day VWAP ending June 20, 2024 was $0.80. Provided for informational purposes only and not relied on for valuation. | $0.48–$1.80 |
Sharecare paid MTS a retainer of $250,000 and a fee of $750,000 for rendering the MTS Opinion; the opinion fee was not contingent upon completion of the Merger or the conclusion reached. Expense reimbursement and indemnification also provided. Neither MTS nor MTS Securities had an engagement with, or received fees from, Sharecare or Parent in the prior two years.
Management projections
| Projection year | Year 1 | Year 2 | CAGR |
|---|---|---|---|
| Revenue | $512M | $619M | 20.8% |
| Revenue growth | 22.7% | 20.8% | |
| EBITDA | $61.7M | $92.0M | 49.1% |
| EBITDA growth | 177.9% | 49.1% | |
| EBITDA margin | 12% | 15% | |
| Implied EV / EBITDA | 6.8x | 4.5x |
Year-1 growth is against LTM at announcement ($417M revenue, $22.2M EBITDA); later years are year over year.
Sharecare management prepared standalone, non-public projections: the February Projections (FY2024-FY2026, prepared February 2024) and the June Projections (FY2024-FY2027, updated June 2024 for Q1 2024 actuals). The June Projections show total revenue of $416.4M in 2024E rising to $700.1M in 2027E, with Adjusted EBITDA of $21.5M in 2024E rising to $109.9M in 2027E (gross margins ~46% to ~48%; adj. EBITDA margins ~5% to ~16%). The February Projections show total revenue of $417.4M (2024E) to $618.9M (2026E) and Adjusted EBITDA of $22.2M to $92.0M. The Projections excluded free cash flow, which each of Houlihan Lokey, MTS and MTS Securities calculated themselves for their DCF analyses; the June Projections were used in the fairness opinions.
Process notes
Other Digital / HealthTech fairness opinions
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- Streamline Health / MDaudit 2025
- iCAD / RadNet 2025
- Accolade / Transcarent 2025 · 35.5x EV/EBITDA
- NextGen Healthcare / Thoma Bravo 2023 · 16.1x EV/EBITDA
- Tabula Rasa HealthCare / Nautic Partners / ExactCare Pharmacy 2023 · 27.1x EV/EBITDA
All Digital / HealthTech opinions → · Houlihan Lokey opinions · MTS Health Partners opinions