Skylight Health to Acquire 3 US Primary Care Practices with Over $10M Revenue and Positive EBITDA

 TORONTO, ON – March 4, 2021 – Skylight Health Group Inc (TSXV:SHG; OTCQX: SHGFF) (“Skylight Health” or the “Company”), one of the largest multi-specialty healthcare systems in the United States, is pleased to announce that it has entered into Letters of Intent (LOIs) to acquire 3 independent Primary Care practices in the United States, immediately adding over $10 million in revenue and positive EBITDA when closed. For confidentiality reasons, the names and locations of the groups will remain undisclosed until the closing of the Transactions, which are anticipated to be completed in early Q2 2021.

  • Skylight Health to acquire 3 independent US primary care groups across multiple states.
  • 2020 unaudited revenue of over $10 million and approximately 10% EBITDA margin.
  • Transactions will be completed with a mixture of cash, debt, and shares. Post closing, the company expects to have over $7M cash on hand.
  • The transactions have a target closing price of between 4 – 5 x EBITDA which is consistent with the Company’s 5 recent transactions. The average purchase price for the combined assets averages below 1 x revenue.
  • Skylight Health forecasted annual revenue run rate now over $56 million after closing of all announced transactions.
  • Immediately accretive deals strengthen organizational team, add to provider and patient count, develop strengthened model for short-term and long-term organic growth.

“These types of transactions are an effective way to increase market penetration and continue to be one of the core strategies to augment our growth,” said Prad Sekar, Co-Founder and CEO of Skylight Health. “We continue to build our pipeline of qualified acquisition targets and will be extremely disciplined about the acquisitions we pursue and focus on achieving favourable pricing and optimal accretion.”

The Company has spent the last 2 months strengthening its executive team and remains focused on the implementation of a corporate strategy that includes technology, organic growth, and strategic acquisitions to continue to increase impact and enhance financial results.  All potential acquisitions will focus strategically on geographic locations and patient volumes, as well as the ability to drive operating efficiencies and maximize earnings accretion. Skylight expects to bring value-based capabilities to independent practices, creating strong organic growth through conversion from fee-for-service models to pay-per-value models with both government and commercial payors.

Closing of the aforementioned acquisitions are subject to final due diligence, negotiation and execution of definitive purchase agreements and all necessary approvals including the Board and regulatory approval with an anticipated closing timeline of early Q2.


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