Medicare Advantage insurtech company Clover Health announced it received a notice from NASDAQ stating the company has regained compliance with the minimum bid price requirement of closing at $1 or more per share for at least 10 consecutive days.
The company said that thanks to NASDAQ’s notice, it will revisit its plans to effect a reverse stock split and share reduction proposal, as noted in a previous SEC filing.
Clover said it achieved compliance on July 28, and NASDAQ closed the matter.
Clover Health provides Medicare Advantage insurance plans and offers provider tools, such as its Clover Assistant, which combines health data with machine learning to provide physicians with patient insights at the point of care. It suggests medications, dosages, tests, referrals and others to help physicians improve health outcomes.
THE LARGER TREND
Social Capital Hedposophia and the Tennessee-based company combined through a mix of cash financing and stock, which brought Clover’s valuation to around $3.7 billion. The insurtech company was to receive up to $728 million of the transaction proceeds and up to $500 million of cash proceeds were to be distributed to existing Clover shareholders.
A month after finalizing its merger, Clover Health came under fire from Hindenburg Research, a short seller that describes itself as a specialist in forensic financial research.
Hindenburg published a report alleging Clover failed to disclose active investigations by the Department of Justice during its SPAC. Hindenburg argued many of the company’s claims were misleading or outright false.
In April of this year, the company announced it settled a securities class action in which the class would receive $22 million, $19.5 million of which the company’s insurance would pay, and the remaining $2.5 million out-of-pocket.
In June, Clover Health relayed it reached an agreement to settle seven lawsuits in Delaware, New York and Tennessee pertaining to allegations the company did not disclose it was under active investigation by the Department of Justice when it went public.
The defendants in the lawsuits were to receive “customary releases,” and Clover Health would implement “a suite of corporate governance enhancements,” according to a press release. Clover did not admit wrongdoing.
No monetary payments were included in the recent settlement other than an award of fees and expenses to the plaintiff’s counsel, and the final settlement was pursuant to court approval.