Longview Acquisition Corporation
PROPOSED BUSINESS COMBINATION: Butterfly Network
ENTERPRISE VALUE: $1.5 billion
ANTICIPATED SYMBOL: BFLY
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.
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 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’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.
TRANSACTION
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. 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 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”.
PIPE
- Concurrently with the execution of the Business Combination Agreement, on November 19, 2020, Longview entered into subscription agreements with certain institutional investors (the “PIPE Investors”), pursuant to which the PIPE Investors have agreed to subscribe for and purchase, immediately prior to the closing of the Business Combination, an aggregate of 17,500,000 shares of the Company’s Class A common stock at a price of $10.00 per share, for aggregate gross proceeds of $175,000,000 (the “PIPE Financing”).
- The PIPE is 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.
FORWARD PURCHASE AGREEMENT
- On November 19, 2020, Longview, Glenview Capital Management, LLC and certain entities affiliated with Glenview (together, the “Forward Purchasers”) entered into an amendment to Longview’s existing forward purchase agreement, dated as of May 20, 2020
- The Forward Purchasers agreed to purchase from Longview an aggregate number of shares of Longview Class A common stock, at a purchase price of $10.00 per share, equal to the value of $75 million minus the aggregate proceeds that would otherwise be released to Longview from the trust account in connection with the Closing (after considering any redemptions of shares of Longview Class A common stock in connection with the Business Combination)
NOTABLE CONDITIONS TO CLOSING
- The aggregate cash proceeds available for release from Longview’s trust account (after giving effect to any redemptions of public shares, if any), together with the proceeds from the PIPE Financing and the Forward Purchase, if any, equaling no less than $250,000,000.
NOTABLE CONDITIONS TO TERMINATION
- By either Longview or Butterfly, if the transactions contemplated by the Business Combination Agreement have not been consummated on or prior to May 15, 2021 (the “Termination Date”)
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.
LONGVIEW ACQUISITION CORPORATION MANAGEMENT & BOARD
Executive Officers
John Rodin, 44
Chief Executive Officer & Director
Mr. Rodin re-joined Glenview as a Partner and Co-President in August 2015. Prior to re-joining Glenview, Mr. Rodin was President of Fantex Brokerage Services, a San Francisco-based start-up in the business of acquiring and IPO’ing shares tied to the cash flows of professional athletes and entertainers. Before joining Fantex in 2012, Mr. Rodin served as Co-President of Glenview. Mr. Rodin started at Glenview in March 2002 and was named Director of Research in 2006 and Partner in April 2007. Prior to joining Glenview, Mr. Rodin worked in the Institutional Equity Sales Department at Goldman Sachs. Prior to his time in the Equities Division, Mr. Rodin spent two years as a Financial Analyst in the Investment Banking Division at Goldman Sachs. Mr. Rodin graduated magna cum laude from Columbia University with a Bachelor of Arts in History in 1997.
Mark Horowitz, 48
Chief Financial Officer
Mr. Horowitz joined Glenview in 2004 and is a Partner and Co-President. Prior to Glenview, Mr. Horowitz was part of the senior management team of Axiom Legal Solutions Inc., a professional services outsourcing firm, which he joined at inception in 2000. Prior to Axiom, Mr. Horowitz was a corporate and securities lawyer at Cravath, Swaine & Moore and Brobeck, Phleger & Harrison. Mr. Horowitz received a J.D. from Harvard Law School in 1996 and a Bachelor of Arts in Economics from the University of Michigan in 1993, where he graduated Phi Beta Kappa with Highest Honors.
Board of Directors
Larry Robbins, 50
Chairman
Mr. Robbins is the Founder, Portfolio Manager and CEO of Glenview. Prior to founding Glenview in 2000, Mr. Robbins spent six years as an analyst and partner at Omega Advisors on their U.S. equity long/short team. He joined Omega after three years at Gleacher & Company, a merger and acquisition advisory boutique in New York. Through their Robbins Family Foundation, Mr. Robbins and his wife Sarahmay are active supporters of education reform both in New York City and on a national level. He serves as Chairman of the Board for Together Education, and he is a Board Member for the Relay Graduate School of Education, Robin Hood Foundation, and Zearn. In addition, Mr. Robbins is the Senior Chair of the Wall Street Division of the UJA-Federation. Mr. Robbins graduated with honors from the Wharton School and Moore School of the University of Pennsylvania in 1992, where he received his Bachelors of Science in Economics and Engineering, with majors in accounting, finance, marketing, and systems engineering.
Westley Moore, 41
Director
Since March 2017, Mr. Moore has served as the Chief Executive Officer of the Robin Hood Foundation, one of the largest anti-poverty organizations in the United States. Before Robin Hood, in 2013, Mr. Moore founded BridgeEdU, an innovative technology platform addressing college completion and job placement, and served as its Chief Executive Officer until February 2017 and its Chairman until June 2019, when it was acquired. Previously, Mr. Moore worked in finance as an investment banker with Deutsche Bank and Citigroup. Mr. Moore is a best-selling author, whose works include “The Other Wes Moore,” “The Work,” “Discovering Wes Moore” and “This Way Home.” He served as a captain and paratrooper with the U.S. Army’s 82nd Airborne, including a combat deployment to Afghanistan, and as a White House Fellow to Secretary of State Condoleezza Rice. Mr. Moore graduated Phi Theta Kappa from Valley Forge Military College in 1998 and Phi Beta Kappa from Johns Hopkins University with a Bachelor of Arts in International Relations in 2001. He earned a MLitt in International Relations from Oxford University as a Rhodes Scholar in 2004.
Derek Cribbs, 49
Director
Mr. Cribbs has served in a variety of roles in the investment management industry. Most recently, Mr. Cribbs served as the Director of Research for Roystone Capital Management LP from April 2016 to February 2019. Prior to Roystone, Mr. Cribbs was a Portfolio Manager and Sector Head at Point72 Asset Management, L.P. from October 2009 to October 2015 and, before that, a Partner at Glenview. Prior to Glenview, Mr. Cribbs worked as an Analyst and Portfolio Manager at Nittany Funds, Oppenheimer & Co. and Gleacher & Co. Mr. Cribbs earned a Bachelor’s Degree from the Wharton School of the University of Pennsylvania and an M.B.A. from Harvard Business School.
Randy Simpson, 51
Director
Mr. Simpson joined Glenview in September 2005 and was named Partner in April 2011. Mr. Simpson is a senior member of Glenview’s investment team and managed Glenview’s healthcare investments through 2019. Prior to joining Glenview, Mr. Simpson was an equity research analyst at Goldman Sachs from 2003 until 2005, and before that, he spent three years as a generalist in the M&A group at Credit Suisse First Boston. He received his M.B.A. in Finance and Accounting from the University of Chicago. Mr. Simpson also earned a J.D. from Georgetown University Law Center and a Bachelor of Arts in Quantitative Economics and Decision Sciences from the University of California, San Diego. Mr. Simpson served on the Board of Directors of Tenet Healthcare Corporation (NYSE: THC) from January 2016 through August 2017.