Startup Medicare Advantage insurer Alignment Healthcare went public Friday, listing its stock on the Nasdaq at $18 per share.
That pricing would raise $489.6 million for the company with 27.2 million shares made available on the exchange Friday. Alignment Healthcare will trade on the Nasdaq under the ticker "ALHC."
The initial public offering is expected to close March 30, the company said in an announcement. The IPO price lands in the middle of the company's projections of between $17 and $19 per share, according to filings with the Securities and Exchange Commission (SEC).
Alignment Healthcare offers an artificial-intelligence-enabled MA plan, and it ended 2020 with 68,323 members, growing 38.5% over 2019. The company launched in 2013 and has seen consistent double-digit membership growth, according to the SEC filings.
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CEO John Kao told Fierce Healthcare that Alignment Healthcare is planning to use funds raised through the IPO to continue scaling and growing its reach.
"I think it’s a testament to the model working, in many respects," Kao said. "We tried really hard to prove it and get the outcomes. Today is just one of the steps in that journey."
"Every single senior in this country deserves the level of care that we provide them," Kao said.
He likened the process to a marathon: Building the company up to this point is like running one, and entering the IPO process is like adding a 10-pound weight to that. Reaching the official IPO day and shedding that heavy weight is a "rewarding" and "emotional" process, he said.
He said Alignment Healthcare has identified 16 metropolitan statistical areas to target for expansion and that it will conduct a multiyear growth strategy to reach those markets.
The company is being "very thoughtful about the cadence of it to ensure that quality is there," he said.
Alignment Healthcare's IPO is coming on the heels of a recent public offering for another startup health plan, Oscar Health, which launched earlier this month. IPOs have been a hot trend for tech-focused healthcare startups, with a number looking at forming special purpose acquisition companies as a way to go public.