Oneview Healthcare to Launch the Largest IPO on ASX Year-to-Date
Oneview Healthcare Aims to Disrupt ‘Traditional’ Patient Engagement in the Healthcare Sector
Irish software provider Oneview Healthcare PLC is launching the largest IPO on the ASX year to date, raising $62.4 million in a $208.5 million listing.
The healthcare information technology market is expected to rise at a compound annual rate of 13.4% over the next five years as global expenditure is estimated to reach US$228.8bn by 2020. Healthcare spending is expected to rise due to an ageing population and technical developments in the industry. OECD has estimated that healthcare spend in Australia has accounted for approximately 9% of GDP in 2013.
Patient engagement is an essential part of the healthcare sector and current global expenditure is estimated to be worth US$5.5billion. However, we have witnessed limited technological developments to date.
The largest ASX IPO year-to-date is Oneview Healthcare PLC, headquartered in Dublin, Ireland, which aims to disrupt the ‘traditional’ engagement with patients. Oneview offers IT solutions that are designed to enhance patient engagement and facilitate communication between hospitals, staff, patients and family members. Oneview believes that its software application drives cost efficiencies, improves clinical outcomes and enhances the patient’s experience.
To date Oneview has been successful in securing 19 contracts with a variety of healthcare facilities, covering a total of 3,292 beds. Management is confident that further contracts can be secured in a market that the company believes offers the potential of more than 1 million beds globally. Oneview has contracts in USA, Australia, Middle East and Europe.
Contracts with healthcare facilities are based on a recurring subscription model and usually valid for 3-5 years. Oneview is in negotiations with a number of tenderers, which represents an opportunity to new revenue sources over the next 12 months. In 2015 Oneview generated revenue of €2.3m and posted a net loss of €10.6m. The proceeds of the raising will be put towards sales and marketing as well as research & development, as management targets vertical and geographical expansion. It is worth noting that Oneview is not yet profitable and is expected to remain reliant on external capital for the foreseeable future. The company may raise additional capital post-listing.
Oneview is priced at $3.58 per share which implies a market cap of $208.5million. In our view this incorporates a substantial degree of further growth, which skews the required risk appetite out of balance.
Company: Oneview Healthcare PLC
ASX Code: ONE
Shares on Offer: 17.4 million
Listing Price: $3.58
Market Capitalisation: $208.5million
Listing Date: March 17
This publication also appeared on The Australian.
Author: Simon Herrmann
Mar 07, 2016
Simon is a financial analyst at independent research firm Wise-owl specialised in small-mid cap growth opportunities and ethical investment opportunities. Simon's aim is to disrupt the cliché approach to investment decision making as he believes that socially and environmentally responsible behaviour is a necessity to long-term wealth creation. Simon has a deep fundamental understanding of the global financial landscape and has compiled 300+ research reports, valuations and corporate appraisals. Simon is commonly featured in major media outlets and his research is published weekly in The Australian.