What You Should Know:
– DarioHealth Corp. (Nasdaq: DRIO) announced the acquisition of Twill, Inc., a leader in digital-led chronic care management, in a move that positions Dario as a major player in the digital health market.
– This strategic acquisition will create a comprehensive platform addressing a wide spectrum of chronic conditions, from emotional health to diabetes and heart disease.
Acquisition Financial Terms
Under financial terms, Dario paid $10 million in cash and issued 10 million shares of common stock in the form of pre-funded warrants to Twill’s debt and equity holders. A concurrent $22.4 million private placement of convertible preferred stock was conducted, raising additional capital. Inducement grants of stock options were issued to key Twill employees and the newly appointed Chief Operating Officer, Tomer Ben-Kiki.
Twill Acquisition Benefits & Industry Impact
The acquisition is expected to significantly boost Dario’s revenue, reaching nearly double the projected $30.5 million for 2023. The combined entity anticipates achieving gross margins of 80-85% by 2025, driven by Twill’s strong financial performance. Dario gains access to Twill’s established customer base, including major national health plans, Fortune 100 employers, and pharmaceutical companies. The combined solutions offer potential for increased revenue by cross-selling to each company’s existing customer base, which currently has minimal overlap.
Immediate cost synergies are expected, reaching nearly 30% within two years, accelerating Dario’s path to profitability within the second year post-acquisition. The combined solution will enhance member engagement throughout their care journey, enabling Dario to deliver better outcomes across broad populations. The acquisition strengthens Dario’s ability to connect members with the right solutions at the right time, creating opportunities for further integrations. By leveraging Twill’s expertise and technology, Dario can offer a more comprehensive and engaging digital health solution to patients and healthcare providers alike.
“The Twill acquisition is an incredible opportunity to bring together our complementary solutions and create an unrivaled platform for the next generation of consumer-centric digital health. The addition of Twill instantly boosts revenue and margins, leveraging a robust SaaS-like model to fuel expected rapid growth and accelerating profitability. We are confident in our ability to integrate Twill and its employees and operations, as we have a track record of integrating previously acquired businesses,” said Erez Raphael, CEO of Dario.