Ellex Medical Lasers shareholders have backed the $100 million sale of the lasers and ultrasound business to Lumibird Group. They also agreed to re-name the company Nova Eye Medical, forming a debt-free entity with a long-term focus on glaucoma therapies.
At an extraordinary general meeting on Friday chaired by Ellex’s executive chairman Mr Victor Previn, shareholders voted in favour of three resolutions that included the return of approximately $61 million of sale proceeds back to them.
The remaining $39 million will fund the expansion of the company’s two remaining business segments comprising the iTrack glaucoma therapy and 2RT for intermediate age-related macular degeneration (iAMD), as well as tax liabilities arising from the transaction, closing adjustments and costs associated with the sale.
The Ellex brand will transfer to Lumibird, a French laser technology giant. It has been previously reported that Lumibird will also acquire Ellex’s production site in Adelaide and its commercial subsidiaries in Australia, Japan, the US, France and Germany.
Subsequently, at Friday’s virtual meeting Ellex shareholders approved a change of name to Nova Eye Medical, which will operate under a new Australian Securities Exchange ticker ‘EYE’. The entity will be debt-free with approximately $21 million in cash, including $2 million held in an escrow account for 12 months.
Previn said the new ticker represented the company’s continued focus on eye disease.
“The primary focus of Nova Eye Medical Limited will be on glaucoma disease via the iTrack business, with manufacturing in Fremont, California and a sales network across the US, Europe and Asia Pacific,” he said.
“This segment generated first half product sales of $6.6 million and an [earnings before interest, taxes, depreciation, and amortisation (EBITDA)] loss of $1.7 million.”
Previn said the company was now assessing potential product acquisitions to add to its glaucoma device sales channel. He expects this to result in at least one transaction during the 2020 financial year.
Nova Eye’s long-term plan is to build a portfolio of products within “the high growth glaucoma consumable device market”, Previn added, while carefully investing into the business to drive revenue growth.
Following the sale, Nova Eye will also retain its 2RT laser technology as an iAMD therapy. This segment generated first half product sales of $800,000 and an EBITDA loss of $200,000.