dorsaVi, used by football clubs, seeks $18 million in IPO

Five AFL clubs and two English Premier League clubs use dorsaVi’s movement monitoring system for injury prevention and the company is seeking US FDA approval.

dorsaVi Ltd, which has developed a wireless sensor movement monitoring system for the medical and sports markets, is seeking to raise $18 million in an initial public offering. The IPO, fully underwritten by Canaccord Genuity Australia Ltd, will sell 41.25 million shares to investors at 40 cents each, according to dorsaVi’s prospectus.

dorsaVi was started in 2000 by Andrew and Dan Ronchi, physiotherapists in private practice who counted an Australian Football League team as a client. The brothers worked on developing a wireless sensor movement-monitoring system that by 2008 had attracted an investment from Melbourne-based venture capital firm Starfish Ventures. Starfish will be issued with 3.75 million shares, bringing dorsaVi’s total number of shares to 121.25 million. That gives the company, which is loss making, an indicative market value of $48.5 million.

In the 12 months to June 30, 2013, dorsaVi’s sales revenue was $398,607 and it made a loss from continuing operations of $1.6 million.

In its prospectus, the company says its technology can “accurately, objectively and quantitatively measure movement and position of the human body in real time and in real situations”. Five AFL clubs, including Richmond Football Club and two English Premier League clubs, use dorsaVi’s product for player screening and injury prevention. Pads are put on the skin to  collect data on motion and muscle activity at rates up to 200 times per second via a wearable wireless unit that is smaller and lighter than a mobile phone. Data can be collected over 24 hours and the monitoring and analysis, dorsaVi says, can be applied to the workplace to prevent injury.

AFL team Richmond reduced its soft tissue injuries by 27 per cent in the 2012 season by using dorsaVi technology, according to the prospectus. dorsaVi, whose chairman is Australia’s greatest middle-distance runner Herb Elliott, employs just 13 people but plans to expand into the US and Europe. It is awaiting US Food and Drug Administration approval of its product.

dorsaVi’s IPO is the second such deal this year that has been won by investment bank Canaccord. The firm is also the underwriter of a planned $30 million share sale by Ibuy, the e-commerce site that sells branded consumer goods.

Toronto-based Canaccord, after its $40 million purchase of 50 per cent of BGF Equities in November 2011, has nearly doubled the number of its Australian staff to 65 people, including 11 people working in corporate finance. In Australia Canaccord has raised $660 million through 40 equity capital markets deals in two years.  

“Our objective is to develop into the leading mid-market investment bank in Australia,” Canaccord’s Australian managing director Marcus Freeman told DataRoom. “We’ve made significant progress over the last couple of years and we’re happy with the direction we’re heading in.”

Applications to buy dorsaVi shares begin November 11 and close November 29. The shares are expected to begin trading on the ASX on December 11.