Babylon, the digital health company that created the NHS GP at Hand App, has put two of its divisions under administration.
Alvarez & Marsal, a restructuring firm, confirmed late Wednesday that it was appointed administrator of two Babylon UK businesses.
According to court records, Babylon Group Holdings (its UK holding company) and Babylon Partners (its research and artificial intelligence unit) had both filed notices announcing the appointment of administrators.
Immediately after the appointment, Babylon’s clinical services, including its GP at Hand mobile app, which serves 100,000 NHS patients in the UK, were sold to eMed Healthcare – a digital healthcare company based in America.
This sale includes the private clinical and corporate healthcare offerings. Babylon UK has more than 700,000 patients.
Andrea Jakes said, “The appointment by Alvarez & Marsal Europe of administrators to oversee Babylon’s UK operations to facilitate a transfer to eMed will ensure the least disruption possible for Babylon users. They should be able to continue operating as usual.”
Babylon’s Jersey Holding Company is also not included in the administration.
Babylon, founded by Iranian born entrepreneur Ali Parsa, and valued at one time at $4bn at the height of its cash crunch, was seeking funding to save it or a buyer.
A spokesman from NHS North West London where Babylon was providing GP appointments said that it remained regularly in contact with GP At Hand and would be informed of any changes to the service.
, a company that runs a video GP in London, and provides a symptom checking app, had already filed for bankruptcy protection with its US-based business.
According to LinkedIn, Babylon employs over 650 people in Britain. However, it wasn’t immediately clear how many of those jobs would be at risk or how many will be transferred as a result of the sale. In the US, hundreds of employees have lost their jobs.
Babylon, once hailed by Matt Hancock, former Health Secretary as “revolutionary”, provided digital healthcare services to NHS Patients in London.
A disastrous float then followed. Investors withdrew funding in anticipation of a merger between the Special Purpose Acquisition Company and Babylon. Babylon was once valued at more than $4bn, making Mr Parsa an official billionaire. However, its value has since collapsed.
It lost $221m in the US last year due to costly expansion efforts. Babylon’s relationship with doctors soured when it made bold statements about the AI that was behind its app. These claims were questioned by experts.
After going public in 2020, the share price of the company plummeted by over 99pc within two years, despite raising more than 1bn dollars from investors including the Saudi Arabian sovereign wealth fund. The company was forced to borrow more than $300m from lenders.
A merger deal which could have saved Babylon from bankruptcy fell through earlier this month.
The company had warned that the future of their business in the UK remained in doubt and that unless they could find a buyer in a firesale, it would be placed in administration.
Babylon’s holding is registered in Jersey and listed in the US. The company is also looking for a buyer to buy one of its US Divisions, a California-based clinical business.