This post was originally published on this site
Shares of WW International Inc (NASDAQ:WW) (commonly known as WeightWatchers) surged more than 50% Tuesday following the company’s announcement that the weight loss company has entered into a definitive agreement to acquire subscription telehealth platform, Sequence.
Launched in 2021, Sequence now serves about 24,000 members across the U.S., as of February 2023, and clocks about $25 million in annual revenue on a run-rate basis. Sequence members have highlighted the benefits of its service, including support in navigating the insurance approval process and the quality care they receive from clinicians.
The telehealth platform’s website says its clinicians can prescribe medications like Novo Nordisk’s (NYSE:NVO) Wegovy and Saxenda, and Eli Lilly’s (NYSE:LLY) Mounjaro.
Currently, Wegovy and Saxenda are approved drugs for obesity in the United States, with tirzepatide also widely expected to be approved for it later this year.
Pursuant to the terms of the merger agreement, WW will acquire Sequence in a cash and equity transaction valued at $132M: $100M at the closing of the transaction, of which $65M ($39M, net of Sequence’s cash) will be paid in cash and $35M in the form of 8.065M newly issued shares of common stock of WW; then $16M in cash on the first and second anniversaries of the closing.
“As science advances rapidly, we know there is a significant opportunity to improve outcomes for those using medications. Clinical interventions require better education, access, care management, community and the integration of a complementary lifestyle program for best results. It is our responsibility, as the trusted leader in weight management, to support those interested in exploring if medications are right for them,” said Sima Sistani, CEO of WeightWatchers.
“With our science-backed lifestyle program and Sequence’s tech platform – which puts complex, slow insurance processes on tech rails – this is an unmatched opportunity for us to create an integrated product offering. We want to ensure we have the best programs and experiences for everyone. Together, we will provide impactful, holistic solutions for people living with overweight or obesity,” said Sistani.
The transaction is subject to customary closing conditions, and is expected to close during the second quarter of 2023.
Shares of WW are up 50.65% in afternoon trading on Tuesday.
