- Transaction proceeds represent anticipated new revenue source
for MSP Recovery
- Transaction to include assignments from healthcare insurance
payors, healthcare providers and self-funded entities.
MSP Recovery, LLC, (“MSP Recovery” or “MSP”), a Medicare,
Medicaid, commercial, and secondary payer reimbursement recovery
leader, that in July announced a planned business combination with
Lionheart Acquisition Corporation II (Nasdaq: LCAPU, LCAP, LCAPW,
“Lionheart” or “LCAP”), today announced an agreement to monetize up
to $3 billion of select healthcare claims recovery interests to its
investment partner, Virage Capital Management LP (“Virage”). This
initial agreement provides the platform to create a new source of
revenue for MSP Recovery.
The agreement gives Virage the right to buy recoveries otherwise
due to MSP’s assignors (“Clients”) – up to an aggregate total of $3
billion. MSP’s 50% share of the recovery amount remains untouched
by the agreement, which now provides an additional avenue to
monetize the Clients’ 50% of the total recovery amount.
MSP Recovery is an industry pioneer in obtaining reimbursements
for Medicare, Medicaid, commercial insurance, and other healthcare
entities from parties which should have paid the claims in the
first place. MSP acquires the assignments of these recoveries from
health insurance payors, healthcare providers and self-funded
entities, and uses its proprietary multi-level data analytics
system to secure recoveries from responsible parties. MSP
historically pays the Clients 50% of such recoveries and retains
the rest.
“In the five years we have been working with Virage, they have
been instrumental in helping build the scope and magnitude of our
business model, having raised hundreds of millions of dollars from
top notch investors,” said John H. Ruiz, CEO of MSP Recovery. “We
are thrilled to enter into this ground-breaking $3 billion-dollar
deal with Virage. This agreement represents MSP’s initial step
toward realization of an additional revenue opportunity that will
further support our market leadership in the healthcare recovery
space. MSP is working hard to continue developing revolutionary
systems that will provide never-before-seen solutions for patients,
providers and payers.”
“Virage Capital Management LP is excited to continue and extend
the successful relationship forged with MSP Recovery, LLC. Over the
last five years, Virage has worked closely with the MSP management
team and witnessed its ability to identify opportunities and
execute on them in both the courtroom and the boardroom. Virage has
been impressed by the MSP management team’s ability to adapt its
business plan to the growing market opportunity. This $3 billion
Assignor Interest Investment Capacity Agreement represents Virage’s
confidence in MSP’s ability to continue to grow their Medicare
claims inventory with assignors of claims and the continued
investment interest from existing and future Virage investors,”
stated Edward Ondarza, Founder and Managing Director of Virage.
“As Lionheart narrowed its search for an acquisition target, we
saw MSP’s revolutionary data analytics platform as the type of
explosive growth opportunity we sought for our shareholders,”
stated Ophir Sternberg, Chairman and CEO of Lionheart. “The
agreement announced today expands on that opportunity and gives MSP
access to a new revenue stream that is incremental to the original
business combination forecast. Moreover, this new agreement with
Virage validates the model and provides additional upside to LCAP
shareholders.”
Today’s announcement follows MSP’s filing in August of a
whistleblower (“qui tam”) lawsuit against 315 auto insurers to
recover billions of dollars for claims that auto insurers should
have paid, but didn’t. MSP continues to find new revenue sources
that were not originally part of the $32.6 billion valuation.
About MSP Recovery
Founded in 2014, MSP Recovery has become a Medicare, Medicaid,
commercial, and secondary payer reimbursement recovery leader,
disrupting the antiquated healthcare reimbursement system with
data-driven solutions to secure recoveries against responsible
parties, while providing the industry with comprehensive compliance
solutions. For more information, visit: www.msprecovery.com
About Virage Capital Management LP
Established in 2013, and with total current assets under
management of approximately $1.3 billion, Virage provides
litigation finance solutions to established law firms and lawyers
for a wide range of business purposes. Virage manages Virage
Recovery Master LP, a private investment vehicle which launched in
March 2018 and closed in 2020, having raised $438 million from U.S.
and European institutional investors to invest in certain claims of
Medicare Advantage Organizations through a joint investment vehicle
with an affiliate of MSP Recovery LLC. For more information, visit:
www.viragecm.com.
About Lionheart Acquisition Corporation II
Lionheart Acquisition Corporation II is a blank check company
formed for the purpose of effecting a merger, capital stock
exchange, asset acquisition, stock purchase, reorganization or
similar business combination with one or more businesses. For more
information, visit: www.LCAP2.com.
Important Information and Where to Find It
In connection with the potential business combination (the
“proposed business combination”), a registration statement on Form
S-4 (the “Form S-4”) is expected to be filed by LCAP with the U.S.
Securities and Exchange Commission (the “SEC”). The Form S-4 will
include a preliminary proxy statement / prospectus to be
distributed to holders of LCAP’s common stock in connection with
LCAP’s solicitation of proxies for the vote of its stockholders in
connection with the proposed business combination and other matters
as described in the Form S-4, as well as a prospectus relating to
the offer and sale of securities to be issued in connection with
the completion of the business combination. This document does not
contain all the information that should be considered concerning
the proposed business combination and is not intended to form the
basis of any investment decision or any other decision in respect
of the proposed business combination. LCAP and MSP urge investors,
stockholders and other interested persons to read, when available,
the Form S-4, including the proxy statement/prospectus included
therein and the amendments thereto as well as any other documents
filed with the SEC in connection with the proposed business
combination as these materials will contain important information
about MSP, LCAP and the proposed business combination. After the
Form S-4 has been filed and declared effective, the definitive
proxy statement/prospectus will be mailed to LCAP’s stockholders as
of the record date established for voting on the proposed business
combination. LCAP’s stockholders will also be able to obtain copies
of such documents, without charge, once available, at the SEC’s
website at www.sec.gov, or by directing a request to: Lionheart
Acquisition Corporation II, 4218 NE 2nd Avenue, Miami, Florida
33137.
INVESTMENT IN ANY SECURITIES DESCRIBED HEREIN HAS NOT BEEN
APPROVED OR DISAPPROVED BY THE SEC OR ANY OTHER REGULATORY
AUTHORITY NOR HAS ANY AUTHORITY PASSED UPON OR ENDORSED THE MERITS
OF THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED
THEREIN.
Participants in the Solicitation of Proxies
This communication is not a solicitation of a proxy from any
investor or securityholder. LCAP, MSP, and their respective
directors, executive officers and other members of their management
and employees, including John Ruiz and Frank Quesada, may, under
SEC rules, be deemed to be participants in the solicitation of
proxies of LCAP’s stockholders in connection with the proposed
business combination. Investors and securityholders may obtain more
detailed information regarding the names, affiliations and
interests of LCAP’s directors and executive officers in LCAP’s
Annual Report on Form 10-K filed with the SEC on March 31, 2021, as
amended, and other reports filed with the SEC. Additional
information regarding the participants will also be included in the
Form S-4 that includes the proxy statement/prospectus, when it
becomes available. When available, these documents can be obtained
free of charge from the sources indicated above.
No Offer or Solicitation
No offer or offering of equity interests or securities of any
kind is being made, conducted or extended at this time. This
communication is for informational purposes only and does not
constitute or include an offer to sell, or a solicitation of an
offer to purchase or subscribe for, equity interests or securities
of any kind or a solicitation of any vote of approval, nor shall
there be any sale, issuance or transfer of any such securities in
any state or jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities laws of such jurisdiction. Any such offer or
solicitation will be made only in connection with the delivery of a
prospectus meeting the requirements of the Securities Act of 1933,
as amended (“Securities Act”), or exemptions therefrom.
Cautionary Note Regarding Forward Looking Statements
This communication includes forward looking statements within
the meaning of the safe harbor from civil liability provided for
such statements by the Private Securities Litigation Reform Act of
1995 (set forth in Section 21E of the Securities Exchange Act of
1934, as amended (“Exchange Act”) and Section 27A of the Securities
Act, which include information relating to future events, future
financial performance, strategies, expectations, competitive
environment, regulation and availability of resources and involve
known and unknown risks, uncertainties and other factors which may
cause our actual results, performance or achievements to be
materially different from any future results, performances or
achievements expressed or implied by the forward-looking
statements. These statements are often accompanied with or by words
such as “expects”, “plans”, “ projects”,” forecasts”,” estimates”,”
intends”, “expects”, “anticipates”, “seeks”, “ targets”,
“continues”, “ believes”, “opinion”, “will”, “could”, “future”,
“growth”, or “may” (or the negatives thereof) or other similar
expressions that predict or indicate future events or trends or
that are not statements of historical matters. These forward
looking statements include, but are not limited to, statements
regarding MSP’s plans, goals and objectives, forecasts, budgets or
projections and any related assumptions, statements and projections
regarding projected MSP claims by paid amounts, projected recovery
percentages, forecasts relating to key revenue drivers, earnings
growth, gross and cumulative recoveries and the implied enterprise
value and LCAP’s and MSP’s expectations with respect to future
performance and anticipated financial impacts of the proposed
business combination, the satisfaction or waiver of the closing
conditions to the proposed business combination, and the timing of
the completion of the proposed business combination. There is no
guarantee that prospects or results or the timing of events
included or referred to in this communication will be achieved or
that MSP will be able to implement successfully its investment
strategy or achieve its investment objectives or return targets.
Accordingly, we caution you against relying on forward-looking
statements. Forward looking statements also are subject to a number
of significant risks and uncertainties that could cause the actual
results to differ materially, and potentially adversely, from those
express or implied in the forward-looking statements. These
statements are based on various assumptions, whether or not
identified in this communication, and on the current expectations
of management and are not predictions of actual performance. Actual
events and circumstances are difficult or impossible to predict and
may differ from assumptions, and such differences may be material.
Many actual events and circumstances are inherently subject to
significant business, economic and competitive uncertainties and
contingencies, and are beyond the control of MSP and LCAP and are
difficult to predict. These forward-looking statements are provided
for illustrative purposes only and are not intended to serve as,
and must not be relied on by any investor as, a guarantee, an
assurance, a prediction or a definitive statement of fact or
probability. Factors that may cause such differences include, but
are not limited to, the occurrence of any event, change, or other
circumstances that could give rise to the termination of the
Membership Interest Purchase Agreement (the “Agreement”); the
outcome of any legal proceedings that may be instituted against
LCAP or MSP or their affiliated companies following the
announcement of the proposed business combination; the inability to
complete the proposed business combination on the expected time
frame or at all, including due to failure to obtain approval of
LCAP’s stockholders, certain regulatory approvals, or the
satisfaction of other conditions to closing in the Agreement; the
occurrence of any event, change, or other circumstance that could
give rise to the termination of the Agreement or could otherwise
cause the proposed business combination to fail to close; the
inability to obtain or maintain the common stock listing on the
Nasdaq Stock Market following the proposed business combination; a
delay or failure to realize the expected benefits of the proposed
business combination; the risk that the proposed business
combination disrupts current plans and operations as a result of
the announcement and consummation of the proposed business
combination; the ability to recognize the anticipated benefits of
the proposed business combination, which may be affected by, among
other things: future economic, financial, lending, competitive and
market conditions, including healthcare spending fluctuations;
future costs of and returns on capital; leverage and lending costs
and terms; operating costs and future business, investment, holding
and sale decisions and costs; the risks associated with MSP’s
business, including, among others, MSP’s ability to capitalize on
its assignment agreements and recover monies that were paid by the
assignors; litigation results; the validity of the assignments of
claims to MSP; a determination that MSP’s claims are not
reasonable, related or necessary; the failure of MSP’s clients to
renew their agreements with MSP (or terminate those agreements
early); MSP’s claims being within applicable statutes of
limitations; the inability to successfully expand the scope of
MSP’s claims or obtain new data and claims from MSP’s existing
assignor base or otherwise; the limited number of MSP’s assignors
and the associated concentration of MSP’s current and future
potential revenue; internal improvements to claims and retail
billing processes by MSP’s clients that reduce the need for and
revenue generated by MSP’s products and services; healthcare
spending fluctuations; programmatic changes to the scope of
benefits and limitations to payment integrity initiatives that
reduce the need for MSP’s services; delays in implementing MSP’s
services to its claims; system interruptions or failures;
cyber-security breaches and other disruptions that could compromise
MSP’s data; MSP’s failure to maintain or upgrade its operational
platforms; MSP’s failure to innovate and develop new solutions, or
the failure of those solutions to be adopted by MSP’s existing and
potential assignors; MSP’s failure to comply with applicable
privacy, security and data laws, regulations and standards,
including with respect to third party providers; changes in
legislation related to healthcare programs and policies; changes in
the healthcare market; negative publicity concerning healthcare
data analytics and payment accuracy; competition; successfully
protecting MSP’s intellectual property rights; the risk that third
parties may allege infringement of their intellectual property;
changes in the healthcare regulatory environment and the failure to
comply with applicable laws and regulations or the increased costs
associated with any such compliance; failure to manage MSP’s
growth; the inability to attract and retain key personnel; MSP’s
reliance on its senior management team and key employees and the
loss it could sustain if any of those employees separated from the
business; the failure of vendors and providers to deliver or
perform as expected, or the loss of such vendors or providers;
MSP’s geographic concentration; MSP’s relatively limited operating
history, which makes it difficult to evaluate its current or future
business prospects; the impact of the ongoing COVID-19 pandemic;
and the risk that MSP may not be able to develop and maintain
effective internal controls. The foregoing list of factors is not
exhaustive. If any of these risks materialize or MSP’s assumptions
prove incorrect, actual results may differ materiality from the
results implied by these forward-looking statements. There may be
additional risks that we do not presently know or currently believe
are immaterial that could also cause actual results to differ from
those contained in the forward-looking statements. The foregoing
list of factors is not exclusive. Additional information concerning
certain of these and other risk factors is contained in LCAP’s most
recent filings with the SEC and will be contained in the Form S-4,
including the proxy statement/prospectus, to be filed with the SEC
in connection with the proposed business combination. This
communication speaks only as of the date indicated, and the
statements, expressions, information and data included therein may
change and may become stale, out-of-date or no longer applicable.
We do not have, and do not undertake, any obligation to update,
amend or revise this communication (or to provide new, amended or
revised materials), including with respect to any forward-looking
statements, whether as a result of new information, future events,
changed plans or circumstances or any other reason, except as
required by law. The communication should not be relied upon as
representing our assessments as of any date subsequent to the date
of this communication. Accordingly, undue reliance should not be
placed upon the communication, including the forward-looking
statements.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210930005959/en/
For Media: ICR, Inc. MSP@icrinc.com
For Investors: ICR, Inc. Marc Griffin
Marc.Griffin@icrinc.com
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