G Medical Innovations Holdings Ltd. (Nasdaq: GMVD), which deals in diagnostics via mobile telephone, has completed an offering on Nasdaq. The Israeli company, headed by Yacov Geva, raised $15 million at a post-money valuation of $65 million. On its first day of trading, the share price fell 30%, bringing the company’s market cap down to $45 million. This was the company’s second attempt at a Nasdaq offering, after the first failed last year. The underwriter was EF Hutton, of the Benchmark group.
The amount raised was small, the valuation was lower than expected, and the share price fell sharply, but at least the offering extricated G Medical from the “between stock markets” situation that it was in. G Medical was listed on the Australian Securities Exchange in 2017, but was delisted in 2020, mainly because it sought to raise money at a much higher valuation, and there were fears that the valuation in Australia would drag the valuation on Nasdaq down.
In 2020, G Medical sought to raise $30 million on Nasdaq at a post-money valuation of $360 million, 13 times its market cap in Australia. That offering failed, and G Medical found itself without a stock exchange, without a source of capital, with the existing investments in the company in limbo, non-liquid. The company can now proceed as a listed company, and, to go by its first day of being traded, some of the investors in it rushed to take advantage of the opportunity to liquidate their holdings as soon as it presented itself.
G Medical was founded by Geva in 2014. The company has developed a mobile app for monitoring vital signs such as temperature, pulse, and oxygen saturation in the blood. In 2020, it received approval from the US Food and Drug Administration (FDA) for monitoring vital signs in people suffering from Covid-19. The company has two further products that have received FDA approval, and also insurance coverage, for remote diagnostics and remote medical services.
In 2020, G Medical had revenue of $4.9 million, a decline from $5.5 million in 2019, before which revenue had trended upwards. The company narrowed its loss in 2020 to $12 million from $15.5 million in 2019.
Geva previously founded and ran LifeWatch, which was floated in Zurich. In 2015, he sold his stake in LifeWatch, which specialized in remote monitoring of heart disease patients and people suffering from sleep disorders, for over NIS 100 million, after a control battle in which he was ousted from management of the company he founded.
Published by Globes, Israel business news – en.globes.co.il – on June 27, 2021
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