Clover Health Investments Corp., an insurance startup backed by Alphabet Inc. and Sequoia, agreed to go public through a merger with blank-check company Social Capital Hedosophia Holdings Corp. III.

The deal values Clover at $3.7 billion, including debt, according to a statement, confirming a report in Bloomberg News.

Clover will receive up to $728 million and another $500 million will be allocated to other Clover investors, the companies said. The deal will be supported by a $400 million investment from Social Capital III Chief Executive Officer Chamath Palihapitiya and investors including Fidelity Management & Research Co. and Senator Investment Group LP.

Clover raised about $500 million in a round led by existing investor Greenoaks Capital in January 2019, TechCrunch reported at that time. The startup offers Medicare Advantage plans in 34 counties across seven states in the U.S. for 57,000 members, according to a press release in July. The firm plans to expand the coverage to another 74 counties.

“We need companies like Clover to help fix our broken health-care system,” Palihapitiya said in a statement. “The company’s rapid growth is a testament to the effectiveness of its tech-enabled approach, which resonates powerfully with consumers and physicians alike.”

Clover CEO and Co-Founder Vivek Garipalli and President and Co-Founder Andrew Toy will continue to lead Clover and Palihapitiya will act as senior adviser to the company’s management. Garipalli and Toy will roll all of their equity in Clover into the new company.

Social Capital III, backed by venture capitalist Palihapitiya and longtime investor Ian Osborne, raised $720 million in an upsized initial public offering in April.

Social Capital, their partnership, raised its first special purpose acquisition company in 2017. It’s ramping up its offerings amid a surge in popularity for the investment vehicles. SPACs provide a faster route for companies seeking to gain a listing without the scrutiny or risks of an initial public offering.

The partnership is seeking to raise at least $2 billion for three new blank-check companies, according to filings last month that confirmed a Bloomberg News report.

Social Capital Hedosophia Holdings Corp. II, another blank-check company by the partnership, agreed to merge with property technology Opendoor last month. Social Capital’s first SPAC merged with billionaire Richard Branson’s space company to form Virgin Galactic Holdings Inc.

The Clover deal is scheduled to close in the first quarter of 2021.

Connaught and Credit Suisse Group AG were financial advisers to Social Capital III, which received legal advice from Skadden Arps Slate Meagher & Flom LLP

Clover’s financial advisers were Citigroup Inc., JPMorgan Chase & Co. and Jefferies Financial Group Inc. Orrick Herrington & Sutcliffe LLP acted as legel adviser.

Healthcare industry Insurance IPOs