Greenbrook TMS Inc. (NASDAQ:GBNH) is set to acquire Transcranial Magnetic Stimulation (TMS) company Success TMS. As part of the deal Success’ owners will receive 11.9 million shares of Greenbrook’s stock, worth roughly $27.3 million.
Greenbrook will pick up 45 active TMS centers as part of the acquisition, bringing its total footprint to 191 active TMS centers. It will also add new states to its geographical footprint including Illinois, New Jersey, Nevada, Pennsylvania and Wisconsin. The deal is expected to build its physician network in these additional states, according to a press release.
“This acquisition should allow us to continue to expand our national footprint of TMS centers throughout the United States,” Bill Leonard, President and Chief Executive Officer of Greenbrook, said in a statement. “This transaction is expected to accelerate Greenbrook’s ability to grow, particularly in the Eastern and Mid-Western regions, through well-established physician networks and key payor relationships.”
Erns Loubser, CFO of Greenbrook, said that the acquisition could help to produce EBITDA positive operations for the joint company, which could help to accelerate its timeline to profitability.
“We expect the acquisition of Success TMS will provide significant scale to the business, with an anticipated immediate post-closing annualized contribution of over $30 million in revenue, representing over 50% growth as compared to Greenbrook’s 2021 annual revenue,” Loubser said during the company’s Q1 earnings call. “We also believe tangible near-term synergies will accelerate the path to profitability and cash flow self-sufficiency.”
During Q1 Greenbrook generated $13.07 million in revenue beating its guidance by $1.2 million. This represented a 15.49% year-over-year revenue increase. However, the company missed its earnings per share expectation by $0.06.
Leonard noted that the company is also growing its Spravato Program, an FDA-approved ketamine-based psychedelic treatment for major depressive disorder. The company is offering the Spravto Program at 23 TMS centers in the US and is looking to expand.
Founded in 2011, Greenbrook went public in 2019 on the Toronto Stock Exchange. This isn’t Greenbrook’s first acquisition. In September the Toronto-based company announced its acquisition of Achieve TMS East.
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