Surgical tech firm UltraGreen.ai files for US$150 million IPO on SGX mainboard
It is offering 112.1 million shares at US$1.45 or S$1.892 apiece; this includes 5.9 million shares for a retail tranche in Singapore
[SINGAPORE] Medical imaging and surgery technology firm UltraGreen.ai is seeking a listing on the mainboard of the Singapore Exchange (SGX), after it registered its prospectus with the Monetary Authority of Singapore on Wednesday (Nov 26).
“I don’t think there’s ever a good time or bad time to do an IPO (initial public offering) because markets change so dynamically,” said Ravinder Sajwan, CEO of Ultragreen.ai. “But I think the most important thing to understand from our perspective is that we are looking at an Asian expansion, and you have to put your foot in the door and say ‘let’s do it’.”
The company – which develops fluorescence-guided surgery technology, offers fluorescence imaging services and supplies indocyanine green dyes used in surgical procedures – has also made an application with SGX to list its shares on Dec 3.
UltraGreen.ai is offering 112.1 million shares at US$1.45 or S$1.892 apiece, comprising 103.4 million new shares and 8.6 million vendor shares, with the aim of raising net proceeds of US$141.8 million or gross proceeds of US$150 million.
The offering shares comprise around 106.2 million placement shares, which will be offered via an international placement to institutional and other investors, and 5.9 million shares that will be offered via a public offer in Singapore.
Separate from the offering, some 163.8 million cornerstone shares will be sold to cornerstone investors, though the company will not receive proceeds from this.
Its market capitalisation will be about US$1.6 billion, based on the offering price and its post-offering share capital.
Net proceeds from the offering and sale of cornerstone shares are estimated to be about US$377.1 million, but the company will only receive about US$141.8 million.
Of this amount, US$55 million will be used for capital expenditure and development of the company’s core products such as indocyanine green dyes, its UltraGreen Data platform and other products and technologies related to fluorescence guided surgery.
Another US$22 million will fund strategic investments and acquisitions, alongside investments and capital expenditure to support its expansion into new geographies, while US$64.8 million will be used for general corporate purposes and working capital needs.
The company will not be seeking out a Nasdaq dual listing, with the main focus being on Singapore. Kwa Chong Seng, chairman of Ultragreen.ai, said the dye business is currently bigger than the data business; but, over time as the latter grows, it could seek out a Nasdaq listing.
“We’re in no hurry to do this, but it’s something that as we build out our data strategy, we will be keen to do,” he said.
Citigroup Global Markets Singapore and DBS are the joint issue managers and joint book runners and underwriters for the proposed IPO.
The group posted a profit before tax of US$33.8 million for its first half ended June, down from US$34.9 million for the year-ago period. Its revenue for the six-month period stood at US$70.1 million, compared to US$58.3 million previously.
UltraGreen.ai does not have a fixed dividend policy at the moment, its product highlights sheet indicated. It noted that any final dividends must be approved by an ordinary resolution of its shareholders at a general meeting; all dividends must be paid out of profits available for distribution.
The group said that it is not permitted to pay dividends “in excess of the amount recommended” by the board and that it cannot provide assurance that dividends will be paid in the future.
Future plans
In terms of future plans, UltraGreen.ai plans to maintain its leading position in the fluorescence guided surgery space in its key markets across Europe and North America by increasing product adoption, expanding application areas and tailoring its offerings to address specific needs of healthcare professionals.
To optimise market economies, it plans to transition to a direct sales model in some markets, as it believes this approach enables it to align operations with sales strategies and maximise revenue potential.
It is also looking to expand its product portfolio to new markets in Asia-Pacific, Europe, the Middle East and Africa with “relatively low” penetration rates of indocyanine green procedures, as these markets present opportunities for enhancing the group’s presence and impact.
In particular, UltraGreen.ai aims to expand its presence in Asia as it believes the region offers “sizeable market opportunity”. It intends to tap this by establishing local offices and dedicated sales and regulatory teams in these markets.
UltraGreen.ai has identified a few applications of its dye and camera system to penetrate the Asian market, such as diabetic foot ulcers and lymphedema.
Diagnosing these conditions can be done outside a hospital, where the company’s dye and camera system can be used in outpatient clinics.
With the camera approved by regulators such as the Food and Drug Administration and CE certified by the European Union, Ultragreen.ai will be coming up with a different financial model to aid adoption in Asia.
The diabetic foot ulcer market in Asia also represents an opportunity for the company. “Five per cent penetration of the diabetic foot ulcer market is twice our current (total addressable market), actually,” said Sajwan.
The company will work with surgeons and specialists to figure out more applications for the dye in procedures. Sajwan added that the goal is to build relationships with medical professionals and get feedback to build better outcomes and procedures.
Singapore will be the base for Ultragreen.ai to manufacture the cameras to be used in conjunction with the dye in clinics outside of surgical theatres.
There are also plans to build a lyophilisation plant in Singapore, which will begin after its plant in the US is finished, as Ultragreen.ai has secured the right to duplicate the US model here.
Over the next 12 months, Ultragreen.ai will focus on increasing adoption in the markets it is in. This includes trying to get its dye made as standard of care in the US and Europe for various medical procedures.
The Asia launch will take some time, as Sajwan is looking to pair the dye with the camera in a model that makes sense for medical professionals here.
“So that it’s the right amount of financial incentive for both us and the practitioner, so we are working on the model,” he said.
Applications for the IPO will close at 12 pm on Dec 1, with trading to begin at 9 am on Dec 3.
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