Vapotherm announced today that it entered into a definitive merger agreement that will result in the company going private.
The Exeter, New Hampshire-based developer of non-invasive respiratory support technologies, was listed as VAPO on the OTCQX. Last December, the NYSE commenced delisting proceedings against the company, suspending trading and leading to the OTCQX move. At that point, BTIG analysts dropped coverage of Vapotherm as well.
Vapotherm today said it signed a merger agreement with newly-formed entity. An affiliate of healthcare investment firm Perceptive Advisors and its Perceptive Discovery Fund organized and funded the deal.
Concurrently, Vapotherm’s existing lender, investment affiliates managed by SLR Capital Partners, agreed to convert approximately $81 million of term debt into preferred equity of the newly-formed entity. Perceptive agreed to invest $50 million of new preferred equity capital into the business. A portion of that goes toward funding the merger consideration and making closing-related payments. The deal sees SLR retain $40 million of term debt.
SLR Head of Life Science Finance, Anthony Storino, said in a news release that the deal helps Vapotherm strengthen its balance sheet.
“Vapotherm has done a significant amount of work to date to ensure it is able to deliver its technology to patients in respiratory distress. We believe the company has a clear vision to expand the use of high-velocity therapy in patients in need and look forward to supporting them in their next stages of growth,” said Konstantin Poukalov, managing director and co-head of Perceptive Discovery.
More details on the deal taking Vapotherm private
Under the terms of the agreement, Vapotherm stockholders receive $2.18 in cash for each outstanding common stock share held immediately prior to the effective time of the merger. That excludes shares held by certain stockholders who agreed to contribute their shares for ownership interests.
The merger consideration of $2.18 per share represents a 166% premium over Vapotherm’s closing price on June 14.
A special committee of the company’s board unanimously recommended that the board approve the merger agreement. Acting upon this recommendation, the board approved the merger and recommended stockholders approve as well.
Vapotherm expects to close the deal in the second half of 2024. It remains subject to customary conditions, including receipt of stockholder approval. Upon completion, Vapotherm will become private and will no longer be publicly listed or traded on OTCQX.
