Vapotherm, a US-based medical device developer that counts healthcare provider Kaiser Permanente as an investor, secured $56m in an initial public offering on the New York Stock Exchange yesterday.
The company issued 4 million shares priced at $14.00 each, at the foot of the IPO’s $14 to $16 range, valuing it at about $234m. They opened at $15.50 yesterday and closed at $16.00.
Founded in 1999, Vapotherm produces devices that treat respiratory distress by delivering heated, humidified and oxygenated air to patients through a high-velocity nasal system. It claims that more than 1.5 million patients had been treated with its Precision Flow products as of the end of September this year.
Approximately $37m of the IPO proceeds will go to upgrading the company’s sales and marketing capabilities, with a good chunk of the cash earmarked for recruitment, while another $11m will go to research and development.
Vapotherm had raised a total of approximately $180m in funding according to press releases and regulatory filings, including $30m in a round led by investment firm Arnerich Massena and backed by Kaiser Permanente Capital that closed in 2016.
Perceptive Advisors also took part in the 2016 round along with existing investors Gilde Healthcare Partners, Morgenthaler Ventures, QuestMark Partners, Adage Capital Management, Crestline Investors and Cross Creek.
Kaiser Permanente’s corporate venturing unit, Kaiser Permanente Ventures, and GE Asset Management, a subsidiary of industrial technology group General Electric, had joined 3×5 Partners, Morgenthaler, QuestMark, Cross Creek and Integral Capital Partners for a $29m round for the company in 2013.
Vapotherm added $24m in a 2014 round featuring Kaiser Permanente Ventures, 3×5 Partners, Gilde Healthcare Partners, Adage Capital Management, Morgenthaler, Integral Capital, Questmark and Cross Creek.
Kaiser Permanente Ventures’ share of the company was less than 5% prior to the offering. Its largest shareholder is 3×5 Partners, which owns a 19.9% stake between two entities that was diluted from 26.2%.
Other notable investors in Vapotherm include SightLine Partners (7.9% post-IPO), Gilde Healthcare Partners (6.5%), Questmark Partners (6%), Morgenthaler Ventures (5.9%), Redmile Group (5.7%) and Perceptive Life Sciences (5.2%).
BofA Merrill Lynch and William Blair are joint book-running managers while Canaccord Genuity is lead manager and BTIG co-manager. They have a 30-day option to buy a further 600,000 shares to increase the IPO’s size to $64.4m.
Image courtesy of Vapotherm.
