Dive Brief:
- Imaging company Conavi Medical will acquire Titan Medical in a reverse takeover, the companies announced on Monday.
- The combined firm will focus on commercializing Conavi’s Novasight Hybrid System, a catheter-based device used to guide minimally invasive coronary procedures.
- The decision ends a strategic review for Titan, which is low on cash. Its board of directors approved a transition from developing robotic-assisted surgery technologies to evaluating new opportunities for its intellectual property, although Titan will retain the rights to develop its Enos surgical robot.
Dive Insight:
Toronto-based Titan has been building a single-port robotic surgery system. The company began looking at strategic alternatives for the business in 2022, citing cash concerns and limited access to new capital.
Last year, the company cut costs further and stopped all spending on the development of its Enos system. Several company executives stepped down, including former CEO Cary Vance. Titan sold non-exclusive licenses to its intellectual property to other surgical robot companies, including Intuitive Surgical. Unable to find a buyer in the robotic surgery space, Titan broadened its search to other companies.
Now, it plans to merge with Toronto-based imaging business Conavi, in a deal that will take the combined company public.
Paul Cataford, Titan’s interim CEO and board chair, said the decision was the result of a “careful review of strategic options,” and the firm was confident in Conavi’s ability to drive continued adoption of its Novasight Hybrid System.
Titan’s shareholders will hold an annual meeting, where they will be asked to approve the consolidation, changing the company’s name from Titan to Conavi Medical or other options approved by the board, and a new equity incentive plan for the combined entity.
Per the agreement, Titan plans to delist its shares from the Toronto Stock Exchange on July 15 and apply to have them listed instead on the TSX Venture Exchange. Conavi plans to raise between $15 million and $20 million in financing.
A subsidiary of Titan will merge with Conavi. The agreement gives Conavi a pre-money valuation of $69.8 million. Titan’s valuation includes $5 million plus the amount of cash held in the company when the deal closes, minus certain liabilities.
“Gaining access to the public capital markets will enhance our financial strength and fuel our growth strategy, enabling us to unlock the full potential of our hybrid imaging technology in the United States and globally,” Conavi CEO Thomas Looby said in the announcement.