The health care company, in talks with an affiliate of the billionaire Chamath Palihapitiya, hopes to use the money to fuel growth and achieve profitability.
A “blank check company” led by the billionaire Chamath Palihapitiya is nearing a deal to acquire the Medicare insurance company Clover Health, according to people familiar with the matter. The deal, which could be announced as soon as Tuesday, would value Clover Health at $3.7 billion.
The deal is being done through a special-purpose vehicle, or SPAC, which uses public market funds to buy private companies and take them public. It is the third such deal done through Mr. Palihapitiya’s Social Capital Hedosophia fund, following the real estate start-up Opendoor and the space tourism company Virgin Galactic.
Clover, founded in 2013, sells Medicare insurance in largely rural or underserved areas. Alongside that insurance, it also offers software to physicians that helps aggregate key data on patients who are part of the Clover network. That data can, in turn, improve care and bring the cost of care down, the company argues.
Still, Clover, which touts its software as a distinguishing feature, has indicated that technology alone is not enough to sustain the company. Clover laid off about a quarter of its employees last year as it sought to focus on hiring health care experts in addition to technology developers.
Source: NY Times
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