VANCOUVER, British Columbia, Oct. 26, 2020 (GLOBE NEWSWIRE) -- CloudMD Software & Services Inc. (TSXV: DOC, OTCQB: DOCRF, Frankfurt: 6PH) (the “Company” or “CloudMD”), a telehealth company revolutionizing the delivery of healthcare to patients, is pleased to provide an update on its North American expansion plans with the closing of the acquisition of Benchmark Systems Inc. (“Benchmark”) and the closing of the acquisition of a U.S. based chronic care clinic in Mississippi.
Benchmark Acquisition Close
CloudMD, through its subsidiary, CloudMD Holdings Corporation (Delaware) Inc., has closed its previously announced acquisition of a majority interest in Benchmark Systems Inc. (“Benchmark”), a leading cloud-based provider of fully integrated solutions that automate healthcare workflow processes including revenue management, practice management and electronic records management. CloudMD purchased 87.5% of Benchmark from its parent company and global healthcare and AI leader, AntWorks Inc. (“AntWorks”). AntWorks has retained a 12.5% equity stake and remains a strategic partner for CloudMD both in the U.S. and globally. The purchase of Benchmark is immediately accretive to CloudMD and provides a number of opportunities for optimization to drive further revenue. In the fiscal year ending March 31, 2020, Benchmark generated approximately US$4.9 million in revenues with earnings before interest, taxes, depreciation and amortization (EBITDA) margins of 13%. Approximately 80% of revenue was SaaS based, recurring revenue.
Benchmark is an innovative cloud-based, health technology company that has integrated medical practice solutions including patient portals, personal health records, scheduling solutions, billing, messaging, eFax, computerized physician order entry (CPOE) and prescription scripting. Benchmark has a national U.S. network of 200 clients, 800 physicians, with 5.5 million patient charts across 35 states. On average, Benchmark processes approximately $2.5 million in charges (gross) each month.
As CloudMD continues to embark on its U.S. expansion, the acquisition of Benchmark strengthens CloudMD’s digital footprint across North America. The acquisition also brings cross selling synergies across Benchmark’s 200 clinics and its geographical footprint in 35 states. Benchmark’s suite of software solutions provides CloudMD with significant distribution channels into the U.S. and integration opportunities for its other virtual care solutions such as those offered through Cloud Practice, Snapclarity and iMD Health. With Benchmark’s experienced leadership team, and seamless workflow process, CloudMD will not only benefit from its extensive geographic reach and client commitment, but also the expertise of developing SAAS systems that support medical practitioners while complying with specific state requirements.
Terms of the Agreement
In consideration for the purchase of 87.5% of the outstanding securities of Benchmark, CloudMD has agreed to pay shareholders aggregate consideration of US$4,375,000 payable in cash, subject to working capital adjustment.
U.S. Chronic Care Clinic Acquisition Close
CloudMD also announces that it has closed the previously announced acquisition to acquire 100% of a U.S. based medical clinic serving chronic care patients as a part of its broader strategy for entering the U.S. market with its comprehensive suite of telehealth products.
The acquisition is an important and strategic part of CloudMD’s cross-border expansion plan into the United States. One of the key goals for CloudMD is to start providing a single comprehensive stop for longitudinal healthcare for chronic and complex care patients in the U.S. These patients often have multiple concurrent diseases such as diabetes, hypertension, vascular and heart disease. The opportunity for expansion with this acquisition is significant, as in the U.S alone, 90% of the $3.5 Trillion spent annually on health care is spent on chronic pain and mental health issues (Source: CDC). CloudMD’s integrated telehealth technology will be used in the clinic practice to provide patient centric, continuity of care.
The clinic is managed by Dr. Fred Roh and Curtis Gibson. Dr. Roh has over 30 years’ experience in the U.S. healthcare market having been founder of Healthcare Networks of America, LLC, a 15,000 member physician organization that provides services to 24 million patients across the U.S. Using CloudMD’s telehealth platform, patient management software and virtual kiosk carts and kits, Dr. Roh will also help with expansion plans to build a network of telehealth powered satellite clinics covering large areas of underserviced areas across the U.S. Curtis Gibson oversees the management of the clinic in Mississippi and will be involved in the expansion of CloudMD services within the southeastern U.S. Mr. Gibson has over 30 years’ experience in investment banking and business development for medical clinics.
Terms of Agreement
In consideration for the purchase of a 100% interest of the U.S. based medical clinic, CloudMD has agreed to a cash payment to the shareholders, along with additional working capital as required.
About CloudMD Software & Services
CloudMD is digitizing the delivery of healthcare by providing a patient centric approach, with an emphasis on continuity of care. The Company offers SAAS based health technology solutions to healthcare providers across North America and has developed proprietary technology that delivers quality healthcare through a holistic offering including hybrid primary care clinics, specialist care, telemedicine, mental health support, educational resources and artificial intelligence (AI). CloudMD currently services a combined ecosystem of over 500 clinics, almost 4000 licensed practitioners and 8 million patient charts across North America.
ON BEHALF OF THE BOARD OF DIRECTORS
“Dr. Essam Hamza, MD"
Chief Executive Officer
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Forward Looking Statements
This news release contains forward-looking statements that are based on CloudMD’s expectations, estimates and projections regarding its business and the economic environment in which it operates, including with respect to its business plans. Although CloudMD believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward-looking statements and readers should not place undue reliance on such statements. These forward-looking statements speak only as of the date on which they are made, and CloudMD undertakes no obligation to update them publicly to reflect new information or the occurrence of future events or circumstances, unless otherwise required to do so by law.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.