It’s a big day on the ASX for Beamtree. Here’s what’s sent its shares skyrocketing.
The post Beamtree (ASX: BMT) share price rockets 21% on acquisition news appeared first on The Motley Fool Australia. –
The Beamtree Holdings Ltd (ASX: BMT) share price is soaring today after the company announced its plan to acquire data analytics firm, Potential(x).
Potential(x) specialises in the health and human services market. According to Beamtree, the acquisition will set it up as the largest health and artificial intelligence-led support platform in Australia.
Right now, the Beamtree share price is 59,5 cents, 21.43% higher than its previous close.
Let’s take a closer look at today’s news from the health data insights and health coding solutions provider.
The Beamtree share price is gaining after the company announced it’s entered an agreement to acquire Potential(x).
The agreement will see Beamtree paying $4 million in cash and providing Potential(x)’s shareholders with 30 million Beamtree shares.
According to Beamtree’s release, Potential(x) has relationships with more than 300 health service providers, including more than 250 hospitals in Australia, New Zealand and the United Arab Emirates. It also has relationships with 35 disability providers that together represent around 40% of National Disability Insurance Scheme (NDIS) funding.
Potential(x) also has a 26-year partnership as the full-service operator for Australia and New Zealand’s The Health Roundtable Ltd. The cooperative includes a network of 200 hospitals across Australia, New Zealand, and the Abu Dhabi Health Services Authority.
Beamtree believes Potential(x)’s existing industry relationships will help it enter the market.
Potential(x) revenue for the 2021 financial year was $11 million. Its normalised earnings before interest, taxes, depreciation and amortisation (EBITDA) came to $2.6 million.
Following the acquisition, Beamtree expects pro forma revenue of $19.9 million and operational EBITDA of $5.7 million.
Commentary from management
Beamtree’s CEO Tim Kelsey commented on the news sending the company’s share price through the roof today:
This agreement marks a major milestone in the growth opportunity for Beamtree – it doubles the size of the company by revenue and employee numbers and makes it one of the largest health analytics and decision support platforms in Australia. The new company already serves health services in more than 24 countries across four continents – we look forward to accelerating our global growth together with the Potential(x) team.
Potential(x)’s CEO Duane Attree added:
We will be bringing our brilliant teams together, who have complementary skills, expertise and a collective vision to put data and technology to best use for improving the quality and value of global health and human services.
Beamtree share price snapshot
The Beamtree share price has been performing well lately.
It’s currently about 40% higher than it was at the start of 2021. It has also gained around 120% since this time last year.
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Beamtree Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.