Butterfly Network, Inc., an innovative digital health company that is working to enable universal access to superior medical imaging, and Longview Acquisition Corp. (NYSE: LGVW.U, LGVW, LGVW WS), a special purpose acquisition company sponsored by Glenview Capital Management, LLC, announced today that they have entered into a definitive business combination agreement. Upon closing, the combined company's Class A common stock is expected to be traded on the New York Stock Exchange under the symbol "BFLY."
Company Overview
Founded in 2011, Butterfly Network, Inc. is an innovative digital health company that has a mission to enable universal access to superior medical imaging, making high quality ultrasound affordable, easy to use, globally accessible and intelligently connected. Butterfly iQ is the only transducer using semiconductor technology that can perform "whole-body imaging" using a single handheld probe. Connected to a mobile phone or tablet, it is powered by Butterfly's proprietary Ultrasound-on-Chip™ technology and harnesses the advantages of AI to deliver advanced imaging that they believe is easy to use, improves patient outcomes and lowers cost of care.
Historically, the global ultrasound market has been dominated by traditional cart-based devices that are accessible only to highly specialized technicians and are located predominantly in hospitals, imaging centers, and physicians' offices. Previously introduced Point-of-Care Ultrasound ("POCUS") devices are limited by 60 year-old technology and significant costs that hinder wide-spread use. Butterfly iQ is designed to address the limitations of currently-available cart-based and POCUS technologies.
Butterfly iQ was launched commercially in 2018, and in 2020, the Company launched the Butterfly iQ+ with additional features and improved performance. Since introduction, more than 30,000 Butterfly iQ and iQ+ devices have shipped to medical professionals globally. The Company has sold to or has agreements in place with the majority of the largest 100 hospitals in the United States, and has built a strong brand among healthcare professionals, achieving an exceptional Net Promoter Score of 71 (USA). Butterfly iQ is commercially available in more than 20 countries including the United States, Canada, greater Europe and Australia.
Butterfly was founded by Dr. Jonathan Rothberg, a scientist and serial entrepreneur who received the Presidential Medal of Technology & Innovation in 2016 for inventing a novel next-generation DNA sequencing method. Prior to this transaction, Butterfly has raised more than $400 million from investors, including Baillie Gifford, The Bill and Melinda Gates Foundation and Fosun Industrial Co., Limited.
Butterfly's management team, led by Chief Executive Officer, Laurent Faracci, will continue to lead the combined company following the transaction and Dr. Rothberg will serve as Chairman of the combined company's Board. Larry Robbins, Chairman of Longview, will become a member of the combined company's Board.
Management Comments
"Nine years ago, Butterfly was created to make high-quality ultrasound affordable, easy to use and globally accessible to all," said Dr. Jonathan Rothberg, founder of Butterfly "My pride in our team's innovation and my gratitude to our partners for their funding and support are only matched by my enthusiasm to realize Butterfly Network's enormous potential. We are pleased to welcome Longview as well as the PIPE investors to the Butterfly family, and we appreciate the support of the public markets in funding our commercial and societal goals."
"The success of Butterfly is fueled by a clear mission, superior technology made simple, a passionate community of healthcare practitioners and an immensely talented team," noted Laurent Faracci, Chief Executive Officer of Butterfly. "We believe the combination with such a premier healthcare partner as Longview Acquisition Corp. will amplify and accelerate the adoption of Butterfly iQ around the world. This partnership will enable us to bring more Butterfly innovative solutions to market faster, helping us improve patient outcomes and the way healthcare is delivered."
"Butterfly is the epitome of value-based care: better health, lower cost, and patient centric," said Larry Robbins, founder of Glenview and Chairman of Longview. "We are proud that our Butterfly investment will help accelerate efforts to provide the medical community with tools to diagnose more clearly and enable practitioners to be more effective, more efficient and more confident. We are honored to support Jonathan, Laurent and the Butterfly team to fully capitalize on their revolutionary technology and aspirational vision."
"Since our May IPO, Longview reviewed more than 50 investment opportunities to find an exciting growth company at an attractive valuation where Glenview could add significant value, and Butterfly emerged as a truly unique partner" said John Rodin, CEO of Longview and Co-President of Glenview. "We are committed to using our two decades of experience as engaged owners in the provider, distributor and payor communities to accelerate constructive collaboration for Butterfly to drive improved health outcomes and greater efficiencies."
Key Transaction Terms
On November 19, 2020, Longview entered into a definitive business combination agreement ("BCA") with Butterfly. Upon the closing of the transactions contemplated by the BCA, Butterfly will become a wholly-owned subsidiary of Longview, and Longview will be renamed "Butterfly Network, Inc." Current security holders of Butterfly, including Baillie Gifford, The Bill and Melinda Gates Foundation and Fosun Industrial Co., Limited will have the right to receive common stock of the combined company, on a one-for-1.0383 basis per share, rounded down to the nearest whole number of shares. The transaction values Butterfly at an enterprise value of approximately $1.5 billion.
The transaction is expected to deliver up to $589 million of gross proceeds, including up to $414 million of cash held in Longview's trust account (assuming no redemptions are effected). The transaction is further supported by a $175 million PIPE at $10.00 per share, led by Eldridge, Fidelity Management & Research Company LLC, Glenview, Ridgeback, Tenet Healthcare Corporation, UPMC Enterprises, the innovation, commercialization and venture capital arm of leading Pittsburgh-based health system UPMC, and Wellington Management. The company is projected to have approximately $584 million in cash on the balance sheet after closing.
Assuming no public stockholders of Longview exercise their redemption rights, ownership of the combined company immediately following the closing will be comprised of current Butterfly equity holders (63.5%) and convertible note holders (2.5%) which together will own approximately 66%, Longview stockholders (20%), Longview's sponsors (5%), and PIPE investors (9%). Upon the closing of the transaction, Dr. Jonathan Rothberg will become Chairman and hold a controlling voting interest in the combined company through his holdings of 20x voting Class B common stock.
The transaction, which has been unanimously approved by the Boards of Directors of Butterfly and Longview, is subject to approval by Longview's stockholders and other customary closing conditions. The proposed business combination is expected to be completed in the first quarter of 2021, with the combined company's Class A common stock trading on the NYSE under the ticker "BFLY".
A more detailed description of the transaction terms and a copy of the Business Combination Agreement will be included in a Current Report on Form 8-K to be filed by Longview with the United States Securities and Exchange Commission ("SEC"). Longview will file a registration statement (which will contain a joint proxy statement/prospectus) with the SEC in connection with the transaction.
Advisors
J.P. Morgan Securities LLC is acting as financial advisor to Butterfly Network. Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. is acting as legal advisor to Butterfly Network. UBS Investment Bank is acting as financial advisor to Longview as well as the exclusive placement agent for the PIPE. UBS Investment Bank and Cowen are acting as capital markets advisors to Longview, and originally underwrote the IPO of Longview in May 2020. Ropes & Gray LLP is acting as legal advisor to Longview.
Management Presentation
A presentation made by the management teams of both Butterfly and Longview regarding the transaction will be available on the websites of Butterfly atwww.butterflynetwork.com and Longview atwww.longviewacquisition.com. Longview will also file the presentation with the SEC in a Current Report on Form 8-K, which will be accessible atwww.sec.gov.
About Butterfly Network
Founded by Dr. Jonathan Rothberg in 2011 and led by CEO Laurent Faracci, Butterfly has created the world's first handheld, single-probe whole-body ultrasound system, Butterfly iQ, to make ultrasound technology more universally accessible and affordable. Butterfly Network's mission is to enable universal access to superior medical imaging, making high quality ultrasound affordable, easy-to-use, globally accessible and intelligently connected, including for the 4.7 billion people around the world lacking access to ultrasound. Through its proprietary Ultrasound-On-Chip™ technology, Butterfly Network is paving the way for earlier detection and remote management of health conditions around the world. The Butterfly iQ+ can be purchased online today by healthcare practitioners in the United States, Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, the Netherlands, New Zealand, Norway, Poland, Portugal, Spain, Sweden, Switzerland and the United Kingdom.
About Longview Acquisition Corp.
Longview was formed to partner with high-quality, growing companies to facilitate their successful entry to the public markets. Longview is sponsored by an affiliate of Glenview Capital Management, a registered investment adviser with a track record of creating value through constructive partnerships with companies operating in the public markets.
