Healthtech Babylon has found a buyer for its UK healthcare business following the collapse of a merger at the beginning of August.
It's sold its clinical services arm — which includes a partnership with Bupa and several smaller contracts — to US business eMed Healthcare, which sells in-home testing kits. Its GP at Hand service, which is used for free by thousands of NHS patients for digital, and in-person, primary care, was not included in the deal.
Babylon's UK holding company Babylon Group Holdings and tech division Babylon Partners — which houses the company’s AI stack, including its symptom checker and triage tools — have filed notices appointing administrations.
Administrators Alvarez and Marsal have said that the sale means clinical services should continue to operate as normal.
How did we get here?
Babylon, which was founded in 2013, was once part of a high-flying generation of UK tech companies but has been trying to claw back a $300m hole in its finances caused by a botched SPAC deal towards the end of 2021. After listing on the New York Stock Exchange, the company saw its stock price fall more than 99%.
While revenues hit $1.1bn in 2022, losses mounted too, reaching $63.2m in Q1 2023 (double those of Q1 2022).
In June, debt funder AlbaCore Capital announced it would be taking the company private and merging with Swiss unicorn MindMaze in an attempt to see some return on the $300m+ it had lent to the company.
But on August 7 it was announced that the deal had fallen through, and Babylon abruptly exited its US business. The company’s UK business teetered on the brink of bankruptcy, and it entered an “accelerated bidding process” as it scrambled to sell before the money ran out.
Administrators will look to sell off what remains of the UK business.
Babylon’s shareholders — which include VNV Global, Kinnevik and Saudi Arabia’s PIF, along with founder Ali Parsa — will still go home empty-handed, with a statement at the beginning of August saying that any proceeds from the sale were not expected to exceed the funds AlbaCore put into the business.
This article previously said that Babylon sold its GP at Hand service. This wasn't accurate — the service wasn't included in the deal. The article has been updated to reflect that.