Telemedicine provider Teladoc Health has reached an agreement to buy the diabetes coaching company Livongo in an $18.5 billion deal that will create the first true health tech giant — in an era in which demand for virtual care is surging.

The merger agreement, announced on Wednesday morning, is expected to create a combined company on track to bring in $1.3 billion in revenue this year, up 85% over last year. Jason Gorevic, Teladoc’s current CEO, will be the CEO of the newly combined company, which will be called Teladoc and will be based in New York. The transaction is expected to close by the end of this year, pending approval of regulators and shareholders.

Both companies have seen their stock prices soar during the pandemic, reaching all time highs this week. Livongo’s share price is nearly six times higher than it was at the start of 2020, and Teladoc’s has tripled in that period….

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