UpHealth has completed the sale of Cloudbreak Health to US private equity company GTCR for $180m.
The sale, which was a full cash deal, will see Cloudbreak become a newly formed entity under the control of GTCR. The acquisition agreement was originally announced in November 2023.
US-based Cloudbreak is a language interpretation service provider. The tech allows for patients with limited English to communicate with healthcare professionals in hospitals, urgent care centres, and clinics.
GTCR stated the sale will solidify Cloudbreak’s position in the telehealth sector. In a market report by GlobalData, telehealth (which includes all forms of virtual care) was globally worth $690m in 2015. It is predicted to increase five-fold and be worth $3.8bn by 2030.
Cloudbreak’s lead product is the Martti (My Accessible Real-Time Trusted Interpreter) platform. The video remote interpretation software connects patients with interpreters across 250 languages.
GTCR previously said it expects to “make substantial investments” in the standalone company to help with marketing, operations, and growth.
As for UpHealth, the proceeds from the sale will go towards sale expenses and debt, including $57.2m and $115m in 2025 and 2026 Notes.
A digital health company with a market cap of $14.75m, UpHealth has struggled for profit in recent times and has shut down some of its businesses. This includes its subsidiary UpHealth Holdings, which filed for a voluntary petition for reorganisation under bankruptcy.
The company raised further funds with the sale of Innovations Group in May 2023. The company and its compounding pharmacy subsidiary MedQuest Pharmacy were sold to Belmar Pharma Solutions for $56m.
UpHealth’s board of directors’ chairman Dr Avi Katz said: “This major restructuring includes so far, shutting down the non-profitable businesses that also presented challenging legal risks, as well as divesting and selling profitable businesses that did not have a good strategic fit to our mission.
[These sales] allowed us to significantly reduce the liabilities of [UpHealth] and enhance its business focus and the financial performance.”
Despite the growth projections for telehealth, the sector was rocked by the collapse of Babylon Health in 2023. Touted as one of the founding modern-day pillars of providing remote healthcare, the bankruptcy of Babylon Health “illustrates the fine line digital health applications must follow”, medical analyst at GlobalData Shane Dibblee told Medical Device Network.
