Rockley Photonics and SC Health Announce Collaboration

Rockley Photonics and SC Health Announce Collaboration

Healthcare Tech Outlook | Thursday, March 25, 2021

Dr Andrew Rickman, Chief Executive, Rockley Photonics

Rockley’s clinic-on-the-wrist technology, which is based on its highly disruptive silicon photonics platform, is significantly more accurate than LED sensors widely used in wearables such as smartwatches and fitness bands.

FREMONT, CA: SC Health, a publicly traded special purpose acquisition company, and Rockley Photonics, a leading global supplier of integrated silicon photonic chips and modules across multiple markets, announced that they have entered into a definitive agreement to merge. Rockley will become a publicly-traded company on the New York Stock Exchange (NYSE) under the symbol RKLY, with a pro forma enterprise value of 1.2 billion dollars.

A.J. Coloma, CEO, SC Health, said, “We could not be more excited to be working with the pioneer of silicon photonics, Dr. Andrew Rickman. We are healthcare investors, and we very quickly understood the transformational nature of Rockley’s technology and the way it will revolutionize consumers’ ability to track, monitor and better understand their day-to-day health and wellness. Based on Rockley’s large addressable market, world-class team, and the myriad applications that their silicon photonics platform enables, we view Rockley as one of the most compelling opportunities in the entire healthcare space.”

“Our partnership with SC Health positions us to accelerate our time-to-market for our compelling health and wellness solutions. Our proven sensor technology, world-class partners and a relentless focus on execution will enable Rockley to deliver life-changing benefits to an enormous number of people. We believe that bringing laboratory diagnostics to the wrist will transform patient monitoring, healthcare delivery, and overall consumer health and wellbeing,” commented Dr. Andrew Rickman, Founder, and CEO, Rockley.

Transforming Healthcare Through Groundbreaking ‘Clinic-On-The-Wrist’ Monitoring Technology

Rockley’s unique sensing platform, which is poised to revolutionize consumer health and wellness by allowing continuous, non-invasive monitoring of multi-modal biomarkers such as lactate, glucose, hydration, blood pressure, and core body temperature, will benefit from the transaction.The business’s clinic-on-the-wrist technology, which is based on its highly disruptive silicon photonics platform, is significantly more accurate than LED sensors widely used in wearables such as smartwatches and fitness bands. It allows constant monitoring of critical vitals in a way that was previously only possible with clinical machinery. Rockley will allow customers to detect diseases earlier, better manage nutrition, and focus on preventive healthcare by bringing laboratory precision diagnostics to wearables. As a result, they will be able to live better and healthier lives.

Rockley is collaborating closely with some of the world’s largest consumer electronics and wearables companies to deliver a full-stack solution that includes co-packaged hardware devices, biosensing algorithms, firmware, and data analytics, allowing these customers to provide meaningful and actionable insights to their users. Beyond consumer electronics, Rockley is working with clinicians and MedTech companies to extend the use of its groundbreaking monitoring platform to medical devices, allowing for better disease detection and prevention.

Rockley’s platform enables low-cost, high-volume production. With capacity reserved and proprietary process flows, its manufacturing ecosystem will allow rapid scale-up for volume production of its highly integrated optical/electronic devices. Rockley’s integrated photonics technology has also been used to create best-in-class chipsets for high-speed data communications and machine vision applications, such as LiDAR. Over 120 patents protect the company’s technology, and it has raised 390 million dollars in funding from non-recurring engineering, investors, government grants, subsidies, and a variety of world-class health-tech and technology VCs, strategic investors, and financial institutions over the course of seven years of product development.

Transaction Overview

The combined company is expected to receive up to 323 million dollars in gross proceeds from the transaction, including 173 million dollars in cash held in SC Health’s trust account.  A 150 million dollars PIPE at 10.00 dollars per share is also supporting the deal, with participation from top-tier institutional investors such as Senvest Management LLC and UBS O’Connor, as well as Medtronic. The transaction proceeds will be used to help the company continue to expand by continuing to produce products in close cooperation with its first customers.

Existing Rockley shareholders will transfer 100 percent of their stock to the combined company, demonstrating their belief in the company’s continued growth. The transaction, which has received unanimous approval from SC Health’s board of directors and Rockley’s independent directors, is expected to close in the second quarter of 2021, subject to shareholder approval and other customary closing conditions, including any applicable regulatory approvals.

Advisors

Rockley and Pillsbury have retained Cowen and Company LLC as their sole financial advisor. Winthrop Shaw Pittman LLP provides legal advice. SC Health has hired BofA Securities as its sole financial advisor and Ropes & Gray LLP as its legal counsel. The PIPE’s placement agents were BofA Securities and Cowen, and Company LLC. Blueshirt Capital Markets is also Rockley’s investor relations advisor.

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