The virtual care field got a little smaller on Wednesday morning. Teladoc Health (TDOC 3.12%) will acquire Livongo Health (LVGO) for a combination of cash and stock that adds up to $18.5 billion based on Teladoc's closing price on Tuesday.

Under the terms of the deal, which has been approved by both company's boards, investors will receive 0.592 shares of Teladoc Health plus $11.33 in cash for each share of Livongo they hold. Once the acquisition is complete, Livongo's former shareholders will hold around 42% of the new company's total shares outstanding.

People in suits shaking hands.

Image source: Getty Images.

Last week, Teladoc Health reported that its second-quarter revenue had leaped by 85% year over year to $241 million; Livongo's revenues have been rising even faster. Along with news of the merger, Livongo reported second-quarter earnings Wednesday morning that beat expectations on the top and bottom lines. 

In Q2, Livongo's total revenue soared 125% year over year to $91.9 million, which was $5.2 million more than analysts' consensus expectation. It also reported adjusted earnings of $0.11 per share, which was $0.10 per share more than the consensus estimate.

The combined new virtual care Goliath is expected to report $1.3 billion in total revenue this year, with adjusted earnings of $120 million.

Livongo's diabetes service sends timely, personalized health feedback to over 410,000 members that helps them manage their condition more effectively. After the acquisition, this figure will most likely swell, along with the usage of its more recently launched services for weight management and hypertension, given that many of the tens of millions of people in the U.S. with healthcare plans that include access to Teladoc Health are managing chronic conditions.