Revel Health and Novu Inc. announced Thursday that they have merged, creating what will be one of the nation's largest health care member engagement companies.
The company will be led by NovuHealth CEO Steve Wigginton, while Revel CEO Jeff Fritz will become an adviser to the CEO and to the board of directors.
Terms of the deal were not disclosed; Triple Tree served as the financial advisor for the deal, while Bass, Berry & Sims was the legal advisor.
Both Revel and NovuHealth create digital consumer engagement tools for health care organizations. That can mean anything from designing campaigns to promote annual check-ups to encouraging healthier behaviors in patients, like taking their medication each day.
The combined company will have around 300 employees; it will also have more than 50 health care clients, including seven of the 10 largest health insurers in the United States. It will have more than 15 million lives served, with a focus on the Medicaid and Medicare markets. Those two markets are still considered big growth opportunities by the health insurance industry; UnitedHealth Group Inc., Medica and Allina Health | Aetna have all recently announced plans to expand their Medicare Advantage market locally.
"The combination instantly gives us a nice amount of scale," Wigginton said. The combined company was described as a "dream team," by Fritz in a statement. Novu grew around 25% year-over-year this year and the combined company is expected to see similar growth moving forward, Wigginton said.
A brand for the new company hasn't been decided on yet, Wigginton said. The name of the combined firm will likely be revealed early next year. Other questions, such as whether the two organizations will keep their separate offices or move into a shared space, are also unanswered; both organizations were starting to feel "pinched" in their existing offices before the Covid-19 pandemic began, he said.
The merger has been in discussion for almost a year, Wigginton said. Existing shareholders in each company will become shareholders in the new combined company. For Revel, that includes Triple Tree's TT Capital Partners, which invested $17.5 million in the company in 2017. For NovuHealth, that includes Memphis-based SSM Partners and Atlanta-based Noro-Mosley Partners.
NovuHealth was ranked the 19th fastest-growing private company in the state on the Business Journal's Fast 50 list last year, with 2018 revenue of $44.4 million. At that time, it had 165 employees. Revel's revenue is unknown.
