- MedAdvisor (MDR) announced today it has successfully tapped institutional investors for $35 million to buy U.S.-based Adheris Health
- The funds were raised through a share placement and an entitlement offer, with a retail segment of the capital raise set to open tomorrow
- However, though MedAdvisor will accept up to $20 million in the retail entitlement offer, the company said it has already raised enough money to fund its US$34.5 million (around A$47 million) Adheris buyout
- MedAdvisor and Adheris offer complementary medication adherence services
- The Adheris buyout gives MedAdvisor access to a massive U.S. market and an addressable network of 180 million patients
- MedAdvisor CEO and Managing Director Robert Read says the purchase is a “transformational” deal for the company
- Shares in MDR opened from a trading halt today and closed 1.25 per cent lower at 40 cents each
MedAdvisor (MDR) announced today it has successfully tapped institutional investors for $35 million to buy U.S.-based Adheris Health.
The funds were raised by placing 61.9 million new shares to institutions at 38 cents a pop, with the remaining $11.5 million raised in an entitlement offer at the same price.
MedAdvisor announced the capital raise in early November, with the new funds planned to go towards the US$34.5 million (around A$47 million) Adheris buyout.
Revealed in tandem with the institutional offer was a retail entitlement offer under which mum and dad investors can subscribe for one new share for every 2.5 already owned at the same price as the institutional offer.
This retail segment of the capital raising plan is set to open on November 13.
Importantly, while MedAdvisor said it will accept a maximum of $20 million from the retail part of the offer, the company told shareholders it does not need any more cash to complete the Adheris purchase — any funds raise from retail investors will simply be icing on the cake.
Why the buy?
MedAdvisor is known as a medication adherence program and offers smartphone-based digital pharmacy services.
Users of MedAdvisor’s tech can connect to their local pharmacy and automatically keep up to date on prescriptions, medication doses, and doctors appointments.
Meanwhile, Adheris is a patient adherence and engagement specialist in the United States.
MedAdvisor management said the Adheris purchase will allow MedAdvisor to become a leader in tailored opt-out, direct-to-patient medication adherence programs in the States. Adheris pulled in US$26.4 million (around A$36 million) in revenue over the 2020 financial year.
The buy gives MedAdvisor an addressable network of 180 million patients. MedAdvisor and Adheris have been business partners since 2019.
MedAdvisor CEO and Managing Director Robert Read said the Adheris purchase is a “transformational” deal for the company.
“Buying a business that we are already deeply and strategically aligned to is a tremendous value creation opportunity — especially as we continue to roll out our joint digital offering in the world’s largest medicines market,” Robert said.
“The additional capabilities will not only accelerate our international growth but deliver key capabilities for the expansion of our key offerings in Australia and around the world,” he said.
Now that MedAdvisor has locked in the funds from institutional investors, the company said it plans to complete the Adheris buyout as early as November 17, 2020.
Shares in MDR opened from a trading halt today and closed 1.25 per cent lower at 40 cents each.