First there was Continental Benefits. Then there was Marpai. Now there is……………………..
Marpai To Acquire Maestro Health
MyHealthGuide Source: PRNewswire, 8/4/2022
NEW YORK — Marpai, Inc., an AI-technology company transforming the $22 billion TPA market supporting self-funded employer health plans, announced it has signed a definitive agreement to acquire Maestro Health (“Maestro”), a leading TPA servicing over 80 self-insured employers, based in Chicago, Illinois.
Highlights of the transaction include:
- At the closing the combined company will serve over 40,000 employee lives with expected combined proforma annual revenues of approximately $40 million in 2022.
- Significant cash of over $20 million on the combined balance sheet expected at closing, which is expected to finance the integration of the two companies.
- While up to date Maestro has posted substantial operating losses as it invested in growth, the joint company expects to target positive EBITDA within 18 months.
- Maestro’s Clinical Management and Cost Containment in-house capabilities will enhance Marpai’s ability to deliver better value to its clients and better health outcomes to its members.
- Purchase Price of $22.1 million is due in April 2024, but, subject to the Company meeting its obligations under the agreement, may be financed over four years by the seller.
- Together, the companies will continue to provide innovative health plan administration for self-insured clients driven by technology.
“Maestro shares our vision on how to improve healthcare for employees and family members covered by self-insured plans,” said Edmundo Gonzalez, CEO of Marpai. “There are tremendous revenue synergies. Maestro has in-house care management that helps members live healthier lives, and we intend to roll this out to the Marpai member base. The Maestro cost containment solutions will also be rolled out to our client base. Marpai’s proactive match making of members to the best care will also be introduced to the Maestro client base.”
The acquisition is expected to more than double Marpai’s revenues (exclusive of third parties’ share of revenues), number of customers and number of members it serves.
“We are committed to continue delivering the high level of customer service that both Maestro’s and Marpai’s customers are used to. We believe that this combination will create long-term benefits for our members, clients as well as our stockholders,” said Gonzalez.
“Combining our TPA experience with Marpai is incredibly exciting. Over the last couple of years, we have made significant investments in cost containment and clinical solutions that are delivering outstanding results for our customers. Marpai brings deep TPA domain expertise, expanded discount network options and incredibly sophisticated approaches to data analytics,” said Brandon Wood, CEO of Maestro Health. “The combined organization will help employers proactively provide benefits that are expected to lead to healthier and more satisfied member populations. This will be unmatched in the market.”
Marpai management will discuss the transaction on the previously announced second quarter operating results conference call which is scheduled for Thursday, August 11 at 8:30 a.m. ET. The call can be accessed as follows: Live Call: US: 1-866-652-5200 / CAN: 1-855-669-9657 / INT TOLL: 1-412-317-6060. Webcast: https://app.webinar.net/0EJlBnd6mVz
About Marpai, Inc.
Marpai, Inc. (Nasdaq: MRAI) is a technology company bringing AI-powered health plan services to employers that directly pay for employee health benefits. Primarily competing in the $22B TPA (Third Party Administrator) sector serving self-funded employer health plans representing over $1T in annual claims, Marpai maximizes the value of the health plan as measured in health outcomes. Marpai takes a member-centric approach that uses AI and big data to connect members to health solutions predicted to have a high probability of positive outcomes and aims to bring value-based care to the self-insured market. With effective early intervention, disease management, claims processing and proactive member outreach, Marpai works to deliver the healthiest member population for the health plan budget. Operating nationwide, Marpai offers access to provider networks including Aetna and Cigna and all TPA services. Visit www.marpaihealth.com.
About Maestro Health
Maestro is a Third-Party Administrator (TPA) for employee health and benefits servicing approximately 25,000 employee lives. Maestro offers end-to-end health plan solutions, integrating in-house care management and cost containment services. Maestro has over 80 customers in over 40 states with a 93% client retention rate, indicating high level of customer satisfaction. Visit www.maestrohealth.com