Viola Private Equity will invest up to $28.4 million in Itamar Medical Ltd via a private investment in public equity (PIPE) deal. Through this deal, Viola Private Equity will become the largest shareholder of Itamar Medical and will work closely with the company’s management to accelerate growth and market expansion.
According to the investment agreement, Itamar Medical will issue shares to Viola Private Equity at the price of NIS 1.449 per share for consideration of $24.1 million. In addition, Itamar Medical will issue to Viola Private Equity, for no additional consideration, non-tradable warrants for the acquisition of up to 50% of issued shares for an exercise price of NIS 1.642 to NIS 1.745 per share.
In parallel, Itamar Medical announced it will initiate a rights offering to existing shareholders to invest an additional $5.9 million under the same conditions of Viola Private Equity’s investment. Viola Private Equity committed to increase its investment by up to $4.3 million, in case of unexercised rights, reaching a total investment of up to $28.4 million.
Following that, Itamar Medical reports that the company has received from its major shareholders—Medtronic, Dr Giora Yaron and Martin Gerstel—a notification regarding their intent to convert their existing $1.6 million shareholders loan to equity by participating in the rights offering, bringing the total investment in the company to $30 million.
Viola Private Equity and the major shareholders agreed that all of their shares in the company will be locked-up for a period of 18 months.
As part of the investment, Jonathan Kolber, general partner at Viola Private Equity and formerly the CEO of Koor Industries Ltd, as well as Sami Totah, general partner at Viola Private Equity and formerly the COO of Amdocs, are expected to join Itamar Medical’s board of directors.
Viola Private Equity is a growth and buyout fund focused on growth-stage companies, private and public, with global presence. In April, Viola Private Equity announced successful fundraising of $250 million for its second fund. The investment in Itamar Medical is its third investment out of this fund, following investments in GlassesUSA.com and VATBox. Viola Private Equity is managed by four General Partners: Harel Beit-On, Jonathan Kolber, Sami Totah, and Ayal Shiran. The fund manages over $410 million and among its recent exits are Mobile Access, Amiad Water Systems, Matomy, and Orad. Viola Private Equity is a controlling shareholder of Degania Medical. Viola Private Equity is a member of the Viola Group, an Israel-based technology-focused Private Equity group with over $2 billion under management. Viola Group recently announced a successful sale of Lumenis, a leading medical device company, to XIO Group for $510 million.
Itamar Medical develops, manufactures and markets non-invasive medical devices based on a unique technology for the diagnosis of cardiovascular diseases and sleep apnea. The company has signed several global strategic agreements, including those with Medtronic, Inc. in the US, Viable Medical Investment Co. Ltd. in China, Philips Respironics GK, and Nihon Kohden in Japan.
“The investment in Itamar Medical is an excellent example of Viola Private Equity’s investment strategy – a growth stage tech company, with a run rate of approximately $20 million in annual revenue, which is at a turning point in launching a new strategy,” said Jonathan Kolber, General Partner at Viola Private Equity. “The company has an outstanding management team that was recently recruited and benefits from the support of the founding investors. Our large investment is intended to further enhance Itamar Medical’s growth, its global expansion and product development. Viola Private Equity brings extensive operating experience in growth investments and we strongly believe in the outstanding potential of Itamar Medical.”
“We praise Viola Private Equity on this investment. The fund examined the company’s activities in depth over the past months and its decision to invest in Itamar Medical is a vote of confidence in the technology as well as the growth potential in our main markets,” said Dr. Giora Yaron, Co-Chairman of Itamar Medical. “We are confident that the managerial experience and knowledge that Viola Private Equity brings will be most beneficial for Itamar Medical’s management and for the company’s continuous success, as well as the strengthening of its financial position and competitive advantage.”
“We are pleased to include such a professional and leading fund as Viola Private Equity as the largest shareholder among our existing, strong shareholders,” said Gilad Glick, CEO of Itamar Medical. “It was extremely important for us to enable our existing shareholders, who have believed in us and who have invested in our company over the years, to take part in this important investment round and hence we have reached an agreement with the fund that enables issuing rights in parallel. An investment of $30 million will enhance the execution of Itamar Medical’s growth strategy and the leveraging of the many financial opportunities we are identifying in the market. This investment, as well as Viola’s commitment to the company’s success, will help position Itamar Medical as a leading player in the cardiovascular diagnosis market. The current investment will strengthen Itamar Medical’s financial position and will enable accelerated growth.”