Babylon Health, a London-based digital-first healthcare platform, aims to complete the sale of its U.K. business by Aug. 25 after a proposed merger with digital neurotherapy company MindMaze collapsed, forcing it to shut down its U.S. operations, according to Sifted.
The deadline to submit bids for the U.K. business passed at 12 p.m. GMT on Aug. 21, with the number of interested parties in the single figures. The sale will be executed through an "accelerated bidding process" with a definitive sale to be agreed by Aug. 25 at the latest, according to a letter to prospective buyers that Sifted obtained.
The speed at which Babylon is seeking to sell the business is down to the precarious financial position it is in. "If the company is teetering on the edge of insolvency, the longer it continues [without selling] the more chance it's got at losing revenue streams," Adam Kudryl, partner and head of Harper James, a corporate law firm, told the publication.
The sale of Babylon's U.K. business is not anticipated to surpass its $300 million-plus debt to credit funder AlbaCore Capital, according to the report. That means shareholders such as Saudi Arabia's public investment fund and venture capitalists Kinnevik and VNV Global will not receive payment.
Babylon's U.K. customers, such as the National Health Service and Bupa, a multinational health insurer with more than 43 million members, will have a say in the deal, according to the letter.
On Aug. 9, Babylon filed for Chapter 7 bankruptcy for two subsidiaries — Babylon Healthcare and Babylon Inc. — as it winds down core U.S. operations. It also recently closed its Austin, Texas, headquarters, laid off 94 employees and abruptly canceled patient appointments.
The company reported a $63.2 million net loss (-20.3 percent net loss margin) in the first quarter, compared to a $29.1 million net loss (-10.9 percent net loss margin) for the same period in 2022.
Babylon did not respond to Becker's request for comment.