Francisco Partners to buy Connecture

Francisco Partners has agreed to acquire Brookfield, Wisconsin-based Connecture Inc, which provides information systems used to create health insurance marketplaces. According to terms of the deal, Francisco Partners will pay $0.35 per share for each share of Connecture common stock not held either by them or another Connecture backer Chrysalis Ventures or their affiliates. Kirkland & Ellis LP is providing legal advice to Francisco Partners on the deal while DLA Piper LLP (US) is doing likewise for Connecture.

PRESS RELEASE

BROOKFIELD, Wis., Jan. 04, 2018 (GLOBE NEWSWIRE) — Connecture, Inc. (OTCQX:CNXR), a provider of web-based information systems used to create health insurance marketplaces, today announced that it has entered into a definitive agreement to be acquired by entities affiliated with the global private equity firm, Francisco Partners.

The transaction has been approved unanimously by Connecture’s Board of Directors upon the recommendation of a Special Committee of independent, outside directors. Under the terms of the agreement, entities affiliated with Francisco Partners have agreed to pay $0.35 per share for each share of Connecture common stock not held by Connecture’s existing preferred investors, Francisco Partners and Chrysalis Ventures, and their affiliates. Upon completion of the transaction, Connecture will become a privately-held company owned by Francisco Partners, Chrysalis Ventures and their affiliates, which have all agreed to roll their existing equity into the acquiring company. The agreement includes a 45 day “go shop” period, although there can be no assurance that this process will result in a superior proposal. Francisco Partners and Chrysalis Ventures, which together own approximately 70% of the combined voting power of Connecture’s outstanding voting shares, have signed a voting and support agreement to support the transaction and any potential superior proposal.

“This transaction comes after a transformational year for our company and we look forward to the next phase,” remarked Jeff Surges, President and CEO of Connecture.

The closing of the transaction is subject to customary closing conditions, including regulatory approvals and the affirmative vote by a majority of the outstanding shares of Connecture’s capital stock voting together as a single class at a to-be-scheduled special meeting of stockholders. The transaction is expected to close in the first half of calendar 2018.

The Special Committee that negotiated and recommended the transaction has retained Houlihan Lokey and Raymond James as its financial advisors and Potter Anderson & Corroon LLP as its legal advisor. DLA Piper LLP (US) is serving as legal advisor to Connecture. Francisco Partners’ legal advisor is Kirkland & Ellis LLP.

About Connecture
Connecture (OTCQX:CNXR) is a leading web-based consumer shopping, enrollment and retention platform for health insurance distribution. Connecture offers a personalized health insurance shopping experience that recommends the best fit insurance plan based on an individual’s preferences, health status, preferred providers, medications and expected out-of-pocket costs. Connecture’s customers are health insurance marketplace operators such as health plans, brokers and exchange operators, who must distribute health insurance in a cost-effective manner to a growing number of insured consumers. Connecture’s solutions automate key functions in the health insurance distribution process, allowing its customers to price and present plan options accurately to consumers and efficiently enroll, renew and manage plan members.

About Francisco Partners
Francisco Partners is a leading global private equity firm, which specializes in investments in technology and technology-enabled services businesses. Since its launch over 17 years ago, Francisco Partners has raised over $14 billion in committed capital and invested in more than 200 technology companies, making it one of the most active and longstanding investors in the technology industry. The firm invests in opportunities where its deep sectoral knowledge and operational expertise can help companies realize their full potential.