Bright Health Group continues to be associated with big bucks.
On Monday, the Minneapolis-based healthcare and medtech company announced it’s raising $750 million, including an investment from Cigna Ventures. Bright Health’s largest shareowner, New Enterprise Associates (NEA) will also participate in the raise as co-investor.
Cigna and NEA will purchase $750 million of convertible perpetual preferred stock at $1,000 per share. The stock carries a 5% dividend and will be convertible into shares of the company’s common stock at approximately $4.55 per share (a 25% premium to the company’s recent average trading prices). The financing is expected to close in January 2022.
Bright Health also provided a re-affirmed 2021 revenue guidance from $4.1 billion to $4.2 billion and provided an outlook for 2022 — $6.5 billion (representing more than 50% annual growth).
“The investment from Cigna and NEA signifies continued conviction in Bright Health Group’s alignment model,” Mike Mikan, President and CEO of Bright Health Group, said in a release. “We are excited about the partnership opportunities for both Bright Health Group and Cigna to bring affordable, personalized healthcare to all consumers.”
If you’ve been even remotely aware of the Minnesota tech scene, you know Bright Health. The capital juggernaut debuted on the public market at $18 per share and sold 51.35 million shares, reaching $924 million. It stands as Minnesota’s largest IPO. That said, the company is still losing money overall according to its Q2 financial report released in August 2021. The company saw an operating loss of $59 million and a net loss of $43.7 million in Q2 — more than the Q1 net loss of $18.1 million.
To learn more about the new Bright Health raise, read the release below.
MINNEAPOLIS–(BUSINESS WIRE)–Bright Health Group, Inc. (“Bright Health Group” or the “Company”) (NYSE: BHG), the first technology-enabled fully aligned system of care, built for healthcare’s consumer retail market, today announced a $750 million financing to support continued growth. The financing includes a strategic investment by Cigna Ventures, the corporate venture capital partner and wholly owned indirect subsidiary of Cigna Corporation (“Cigna”), as a new investor in the company. The Company’s largest existing shareholder, New Enterprise Associates (“NEA”), will also participate as a co-investor. The investment from these two leading institutions demonstrates support for the expansion of Bright Health Group’s differentiated alignment model.
Under the terms of the investment, Cigna and NEA will purchase, in aggregate, $750 million of convertible perpetual preferred stock (the “Series A Preferred”), with a purchase price of $1,000 per share. The Series A Preferred carries a 5.0% dividend, which will be payable in kind or in cash at the Company’s election, and will be convertible into shares of the Company’s common stock at an initial conversion price of approximately $4.55 per share, representing a 25% premium to the arithmetic average of the Company’s daily volume-weighted average price over the trailing 10 trading day period ending on December 3, 2021.
Cigna Ventures brings deep healthcare expertise to complement Bright Health Group’s mission. “Cigna Ventures is committed to improving and expanding access to quality, affordable healthcare, and our investment in Bright Health Group aligns with our vision,” said Tom Richards, head of Cigna Ventures. “We seek to be partners of choice and we look forward to exploring new ways that NeueHealth and Evernorth can potentially provide services to each other’s customers and clients.” The investment is also backed and partially funded through Cigna.
“The investment from Cigna and NEA signifies continued conviction in Bright Health Group’s alignment model,” said Mike Mikan, President and CEO of Bright Health Group. “We are excited about the partnership opportunities for both Bright Health Group and Cigna to bring affordable, personalized healthcare to all consumers.”
The financing is expected to close in January of 2022, subject to customary closing conditions. The financing does not require additional regulatory approvals. More information regarding the financing and the key terms of the Series A Preferred will be included in a Form 8-K to be filed by Bright Health Group with the Securities and Exchange Commission.
About Bright Health Group
Bright Health Group is the first technology-enabled, fully aligned system of care built for healthcare’s consumer retail market. Our differentiated approach aligns care delivery with the financing of care to drive better outcomes, lower costs, and enhance the consumer experience. We have two market-facing businesses: NeueHealth and Bright HealthCare. NeueHealth provides care delivery and value-based enablement services through our 131 owned and affiliated clinics and broader Care Partner network. Bright HealthCare offers Commercial and Medicare health plan products to over 720,000 consumers across the nation. We believe everyone should have access to personal, affordable, and high-quality healthcare. Our mission is to Make healthcare right. Together. For more information, visit www.brighthealthgroup.com.