Talkspace Near a Deal to Go Public Via Doug Braunstein’s SPAC

(Bloomberg) -- Talkspace, an online therapy app promoted by celebrities including swimmer Michael Phelps and singer Demi Lovato, is nearing a deal to go public through a merger with Hudson Executive Investment Corp., a blank-check firm, according to people with knowledge of the matter.

The special purpose acquisition company is discussing raising more than $200 million in new equity to support a merger with New York-based Talkspace that would give the combined entity an equity value of more than $1.5 billion, said one of the people. While a deal could be announced as soon as this week, as with any transaction that’s not yet finalized, it’s possible that terms change or talks fall apart.

Representatives for Talkspace and Hudson didn’t immediately respond to requests for comment.

The Hudson SPAC, which raised $414 million in a June 2020 initial public offering, is led by Chairman Doug Braunstein, former chief financial officer of JPMorgan Chase & Co., and Chief Executive Officer Doug Bergeron, a longtime financial-services executive and ex-CEO of Verifone Systems Inc. Both are managing partners at Hudson Executive Capital LP.

Talkspace has been exploring a sale and attracted interest from SPACs, Bloomberg reported in November. The company links patients with licensed therapists by video chat and text, allowing them to seek treatment from home. It uses tools such as machine learning and artificial intelligence to analyze transcripts of therapy sessions to detect trends in a patient’s behavior that it says can lead to better treatment options.

The startup, which has a partnership with U.S. health insurer UnitedHealth Group Inc, has raised capital from investors including Revolution Growth, Norwest Venture Partners, Qumra Capital, Spark Capital and Compound.