Vancouver-based clinic network and healthtech company Well Health is now the proud parent of another publicly traded company.
The news: Wellstar, Well Health’s software-focused spin-out, began trading on the TSX Venture Exchange (TSXV) on Thursday morning under the symbol $WSTR.
In a move that’s been planned since 2024, Wellstar struck a merger deal with a BC-based shell company earlier this year, before applying to list its shares on the TSXV. Now established on the exchange and majority-owned by Well Health, Wellstar’s five-person board of directors includes Well Health chairman and CEO Hamed Shahbazi (who is also Wellstar’s chairman), former Well Health COO Amir Javidan (who is also Wellstar’s CEO), and Well Health CFO Evelyn Sutherland.
Wellstar stock was trading at $7.25 per share as of publication time.
From the source: In Well Health’s Q2 2024 earnings call, Shahbazi said that the company was undervalued compared to the sum of its parts, and floated the idea of unlocking value by making Wellstar (then Well Provider Solutions) its own Well Health-controlled public company.
The context: Spinning out Wellstar is meant to separate Well Health’s primary business, which operates around 275 medical clinics across Canada, from its clinical software tools business. Well Health, which trades on the more established TSX, has said it expects to remain a “significant long-term controlling shareholder and growing customer” of Wellstar.
Over the past nearly two years of planning the spin-out, Wellstar has raised $148 million CAD for its treasury and acquired two Canadian medical billing companies to build out its offerings ahead of the spin-out.
Final thought: The Wellstar spin-out is just one way Well Health is aggressively pursuing growth. Well Health obtained a majority controlling interest in its longtime Toronto-based partner Healwell AI last year, just as Healwell closed a deal to buy New Zealand’s Orion Health. The deal was hefty enough that Canada’s federal competition watchdog obtained a court order to investigate whether the purchase will affect competition for healthcare technology and services in Canada.
Feature image courtesy Well Health.