Blackstone (BX) has taken a significant step in the healthcare sector by backing the merger of HealthComp and Virgin Pulse, properties of New Mountain Capital and Marlin Equity Partners, respectively. The health-care union is estimated at a robust valuation of approximately $3 billion. Blackstone, demonstrating its pivotal role in the merger, will act as the mainstay lender in a credit facility that underpins this transaction. The merger's end game is to cultivate an enterprise poised to offer a plethora of services including health-plan design, management solutions, preventive care initiatives, and digital therapeutics. This combined force aims to serve a vast clientele of over 20 million members and in excess of 1,000 self-insured employers.
Blackstone's prior engagements in the sector include spearheading a first lien financing initiative for HealthComp. Furthermore, in a collaborative effort with private credit stalwarts such as BC Partners and Oaktree Capital Management (OAK-A), Blackstone had extended its lending expertise to Virgin Pulse. This historical synergy with both companies instilled the confidence in Blackstone to wholly commit to the debt financing of this substantial merger. However, there's speculation that Blackstone may contemplate redistributing portions of the facility to either its own or New Mountain’s limited partners, leveraging the strength of previous partnerships.
Post-merger dynamics highlight New Mountain Capital emerging as the predominant owner of the conjoined entity. This union is not merely a transaction but is perceived as a monumental leap in the healthcare domain. The synergy of HealthComp and Virgin Pulse is expected to orchestrate a formidable platform in healthcare, driving innovation and offering comprehensive solutions.
The culmination of this merger, which is still contingent upon requisite regulatory green lights, is eagerly anticipated in the fourth quarter of 2023. With Blackstone at the helm of this transaction, it reaffirms the firm's vested interest and bullish stance on the rapidly evolving healthcare and digital therapeutics arena.
