Apr 7, 2021 - Economy

British COVID test firm LumiraDx enters $5 billion SPAC deal

LumiraDx, a British diagnostics startup that makes COVID-19 tests, has agreed to merge with special purpose acquisition company (SPAC) CA Healthcare Acquisition Corp. in a deal valued at $5 billion, the companies announced Tuesday.

Details: LumiraDx has also secured a $300 million loan from BioPharma Credit and another $100 million from Capital One Financial, per the statement.

  • It previously planned to go public via an IPO, filing with the Securities and Exchange Commission in January.
  • The company, whose clients include the United Kingdom's National Health Service, and the Bill & Melinda Gates Foundation, has placed 2021 revenue estimates at $600 million to $1 billion, up from $139 million in 2020, Bloomberg notes.

What they're saying: LumiraDx CEO Ron Zwanziger told Bloomberg the pandemic had driven demand for the company's machines, but the "broader focus" was on "bringing point-of-care tests to patients."

  • "Fundamentally we’re about transforming community-based care," he said

The big picture: SPACs have seen a boom in the past year, with companies in a wide range of sectors opting for this route to hit the public market.

  • Though the majority have been based in the U.S., a growing number of European companies have also begun to merge with American SPACs.

Editor's note: This story has been corrected to show the price was $5 billion not $5 million.

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