Overview of Volpara – ASX Listed AI SaaS Company
- D23 client mandated by Volpara Board in May 2023
- SaaS company using AI for Breast Cancer Detection / Prevention
- HQ in NZ, ASX listed, 95% USA Revenue
- 20% Revenue Growth, declining to 17%, EBITDA breakeven
- Competitors include Mach7, iCAD, Hologic, Screenpoint, Radnet, Lunit
- Pure software company – no hardware / equipment
Volpara / Lunit – M&A Transaction Metrics
- Large takeover premium – 33% higher than 5 year ASX takeover average
- Attractive Revenue Multiple for breakeven company, with no history of profitability and with declining revenue growth
- 2 Public companies in complex cross-border deal
- Signed Voting Agreements with 3 largest shareholders representing 29% of voting stock, reducing risk of shareholder vote
Customised Transaction Process Delivered Premium Valuation
Global ‘Market Test’
- Ran process with seven tier 1 global software Investors – “the board has not authorised a company sale…..”
Multiple Sponsor NBIOs
- In-person management meetings in New York, San Fran, Palo Alto and London
- 3 month process – “no timeline, as this is not a sale process, so no deadlines”
- Generated multiple indicative offers – did not initially go to strategics / competitors
Approached Strategics Next
- Approached 3 largest competitors – received 1 bid, achieved a 2nd higher revised bid due to competitive tension prior to granting exclusivity, Lunit ultimately bid 45% more than next highest bid
Wall Crossed 3 Largest Investors, Securing 27% of Vote
- Negotiated away all conditionality and price adjustments 1) no financing condition, 2) no anti-trust condition, 3) no price adjustment due to cash / debt / dilutive securities / working capital
- Wall crossed 3 largest shareholders under NDA and secured voting agreements prior to announcement, representing 29% of shares – shareholder vote has high chance of success