Butterfly Network to be listed on NYSE through a merger with Longview Acquisition Corp.
Butterfly Network, Inc. (“Butterfly” or the “Company”), 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) (“Longview”), a special purpose acquisition company sponsored by Glenview Capital Management, LLC (“Glenview”), 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 (“NYSE”) under the symbol “BFLY.”
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.
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”.