Health Insurance Innovations acquires direct-to-consumer platform

Health Insurance Innovations (NASDAQ:HIIQ) has acquired TogetherHealth, a direct-to-consumer platform aimed at the “over 65” insurance market.

Under the terms of the deal, HIIQ paid ~$50M in cash plus 630K shares of Class A common stock. It also included a five-year earnout provision.

The transaction will add at least $10M to HIIQ’s 2019 non-GAAP EBITDA.

Updated 2019 guidance: revenues: $450M – 460M from $430M – 440M; non-GAAP EBITDA: $82M – 87M from $72M – 77M; non-GAAP EPS: $3.80 – 4.05 from $3.50 – 3.75.

The company has established a new $215M credit facility that includes a $150M term loan and a $65M revolver. The term loan will fund the refinancing of $65M of existing debt and the cash portion of the transaction.

Management will host a conference call this morning at 9:00 am ET to discuss the deal.

Shares are up 6% premarket on light volume.

https://seekingalpha.com/news/3469496-health-insurance-innovations-acquires-direct-consumer-platform-shares-6-percent