Bright Health Group Inc (NYSE: BHG) stock price rallied 12.4% after raising $750 million in funding from Cigna Ventures, a wholly-owned indirect subsidiary of Cigna Corporation, and its largest existing shareholder New Enterprise Associates (NEA).
The two lead investors will purchase Series A Preferred shares in Bright Health that carry a 5% dividend priced at $1,000 each, which are also convertible into the company’s common shares at a conversion price of $4.55 each, representing a 25% premium to its trailing 10-day average price.
Tom Richards, head of Cigna Ventures, said: “Cigna Ventures is committed to improving and expanding access to quality, affordable healthcare, and our investment in Bright Health Group aligns with our vision,”
Adding:
“We seek to be partners of choice, and we look forward to exploring new ways that NeueHealth and Evernorth can potentially provide services to each other’s customers and clients.”
Mike Mikan, the President and CEO of Bright Health Group, said: “The investment from Cigna and NEA signifies continued conviction in Bright Health Group’s alignment model. We are excited about the partnership opportunities for both Bright Health Group and Cigna to bring affordable, personalized healthcare to all consumers.”
The deal is expected to close in January 2022 and does not require additional regulatory approvals.
Investors cheered the announcement, as evidenced by today’s rally, and many are hoping that the news will fuel a more significant rally in Bright Health’s share price.
*This is not investment advice. Always do your due diligence before making investment decisions.
Bright Health stock price.
Bright Health stock price rallied 12.43% to trade at $4.25, rising from Monday’s $3.78.
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