Rockley looking to pave the way for next generation of consumer wearables and medical devices with partner SC Health Corp

Rockley Photonics, a developer of integrated silicon photonic chips and modules, has entered into a definitive agreement to combine with SC Health Corp, a publicly traded special purpose acquisition company. The transaction will result in Rockley becoming a publicly traded company on the NYSE under the symbol RKLY with a values of $1.2 billion.

The transaction will accelerate the commercial launch of Rockley's health sensing platform which enables continuous, non-invasive monitoring of multi-modal biomarkers such as lactate, glucose, hydration, blood pressure, and core body temperature.

Built on its silicon photonics platform (see above), Rockley's consumer-targeted 'clinic-on-the-wrist' technology is said to be significantly more accurate than LED sensors commonly used today in wearables such as smart watches and fitness bands. And it allows for continuous monitoring of key vitals in a way that was previously possible only with clinical machines.

By bringing laboratory precision diagnostics to wearables, Rockley hopes to enable consumers to detect diseases earlier, better manage nutrition, and focus on preventive healthcare so they can live better and healthier lives.

Rockley is working closely with some of the world's largest consumer electronics and wearables companies to provide them with a full-stack solution, including co-packaged hardware devices, biosensing algorithms, firmware, and data analytics to enable these customers to provide meaningful and actionable insights to their users.

Beyond consumer electronics, Rockley is partnering with clinicians and MedTech companies to expand the application of its monitoring platform to medical devices to improve disease detection and prevention.

Rockley has also applied its integrated photonics technology to deliver chipsets for high- speed data communications and machine vision applications, including LiDAR. Its technology is protected by over 120 patents and the company has raised $390 million in funding from over seven years of product development from non-recurring engineering, investors, government grants, subsidies and a range of world-class health-tech and technology VCs, strategic investors, and financial institutions.

Management Comments

Andrew Rickman, Rockley's founder and CEO, commented, “Our partnership with SC Health positions us to accelerate our time-to-market for our compelling health and wellness solutions. Our proven sensor technology, world-class partners and a relentless focus on execution will enable Rockley to deliver life- changing benefits to an enormous number of people. We believe that bringing laboratory diagnostics to the wrist will transform patient monitoring, healthcare delivery, and overall consumer health and wellbeing.”

A.J. Coloma, CEO of SC Health, commented, “We could not be more excited to be working with the pioneer of silicon photonics, Dr. Andrew Rickman. We are healthcare investors, and we very quickly understood the transformational nature of Rockley's technology and the way it will revolutionize consumers' ability to track, monitor and better understand their day-to-day health and wellness. Based on Rockley's large addressable market, world-class team, and the myriad applications that their silicon photonics platform enables, we view Rockley as one of the most compelling opportunities in the entire healthcare space.”

Transaction Overview

The transaction is expected to deliver up to $323 million of gross proceeds to the combined company, including the contribution of up to $173 million of cash held in SC Health's trust account. The combination is further supported by a $150 million PIPE at $10.00 per share, with participation from top-tier institutional investors including Senvest Management LLC and UBS O'Connor and participation from Medtronic. Proceeds of the transaction will support the Company's continued growth through ongoing product development in close collaboration with its initial customers.

Existing Rockley shareholders will roll 100 percent of their equity into the combined company, demonstrating their conviction of Rockley's continued growth trajectory.

The transaction, which has been unanimously approved by SC Health's board of directors and the independent directors of Rockley's board of directors, is expected to close in the second quarter of 2021, subject to approval by SC Health's shareholders and other customary closing conditions, including any applicable regulatory approvals.

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