Venus Concept Completes Merger With Restoration Robotics and Combined Company Raises $28 Million in Private Placement

Venus Concept Completes Merger With Restoration Robotics and Combined Company Raises $28 Million in Private Placement

Venus Concept Inc., a global medical aesthetic technology leader today announced the completion of its previously announced merger with Restoration Robotic, Inc. (NASDAQ: HAIR, through November 7, 2019), a leader in robotic hair restoration, effective as of November 7, 2019. Following the completion of the merger, Venus Concept completed a $28 million equity financing by EW Healthcare Partners, HealthQuest Capital, SEDCO Capital and others.

The holders of shares of shares of Venus Concept Ltd. capital stock outstanding immediately prior to the merger received 8.6506 shares of Restoration Robotics common stock in exchange for each share of Venus Concept Ltd. ordinary and preferred shares in the merger. Immediately following the completion of the merger, Venus Concept effected a 1-for-15 reverse stock split of its outstanding common stock. Following the completion of the merger and the equity financing, the combined company had approximately 29.7 million shares of common stock outstanding, on a post reverse stock split basis.

Following completion of the merger, Restoration Robotics changed its name to Venus Concept Inc. The combined company will commence trading on November 8, 2019 on The Nasdaq Global Market under the ticker symbol “VERO”.

“We are pleased to announce the closing of our merger with Restoration Robotics,” said Domenic Serafino, Chief Executive Officer of Venus Concept. “We have made significant progress in enhancing our financial condition with our recent financing activities. The outlook for Venus Concept is very positive and we believe the combined company is well positioned as a leading player in both the global minimally invasive/non-invasive medical aesthetics market and the minimally invasive surgical hair restoration market.”

Following the completion of the merger, Restoration Robotics moved its corporate headquarters to Toronto, Canada. The combined company operates under the leadership of Venus Concept’s management, including Domenic Serafino as Chief Executive Officer, Domenic Della Penna as Chief Financial Officer and Soren Maor Sinay as Chief Operating Officer. Scott Barry, affiliated with EW Healthcare Partners, will be Chairman of the Board of Directors of the combined company, which will include Mr. Serafino, Juliet Bakker affiliated with Longitude Capital Management, Garheng Kong affiliated with HealthQuest Capital, Louise Lacchin, Fritz LaPorte, Anthony Natale affiliated with Aperture Venture Partners, and Keith Sullivan and Frederic Moll, both directors of Restoration Robotics.

Venus Concept and Restoration Robotics Preliminary Third Quarter and First Nine Months of 2019 Revenue Results

Venus Concept Ltd.’s preliminary revenue for the quarter ended September 30, 2019 is expected in the range of $25.8 million to $26.2 million, up 1% to 2%, as compared to $25.6 million in the third quarter of 2018.

For the nine months ended September 30, 2019, Venus Concept Ltd.’s preliminary revenue is expected in the range of $78.2 million to $78.6 million, up 6% compared to $74.0 million in the first nine months of 2018.

Restoration Robotics’ preliminary revenue for the quarter ended September 30, 2019 is expected in the range of $2.9 million to $3.3 million, down 31% to 40%, as compared to $4.8 million in the third quarter of 2018.

For the nine months ended September 30, 2019, Restoration Robotics’ preliminary revenue is expected in the range of $11.2 million to $11.6 million, down 24% to 27% compared to $15.3 million in the first nine months of 2018.

Venus Concept Ltd. is a private company and its shares were not publicly traded prior to the merger.  Venus Concept Ltd. has not historically reported quarterly financial results.  The financial information provided for Venus Concept Ltd. and Restoration Robotics third quarter results is preliminary and subject to change and actual reported results could differ from the results set forth herein.

 Combined Company 2019 Revenue Outlook

Revenue guidance for the combined company is now expected in the range of $123 million to $126 million for the twelve months ending December 31, 2019. The prior revenue guidance for the combined company was expected in the range of $130 million to $135 million.

“As a result of the protracted period between the announcement, and closing, of our merger with Restoration Robotics, the commercial performance of both organizations has been impacted by the deal overhang, hence the need to update the combined company 2019 revenue expectations,” said Domenic Serafino, Chairman and Chief Executive Officer of Venus Concept. “Nevertheless, Venus Concept revenue still grew 6% year-over-year for the first nine months of 2019 and we are confident in our ability to drive total revenue growth for the legacy Venus Concept business in the range of 5% to 8% in 2019.”

Mr. Serafino continued: “The Venus Concept growth expectation for 2019 does not fully reflect the opportunity for our Venus BlissTM, an innovative fat reduction solution which received 510(k) clearance in late-June. The timing of the Venus Bliss clearance was well ahead of our internal expectations and we have been working expeditiously to build the requisite capacity to meet the demand for this new product. We expect to begin our full commercial launch in the first quarter of 2020.  We are excited to launch an offering in one of the fastest growing non-surgical, non-injectable, procedure categories in the medical aesthetics industry today. Despite the tempered combined company 2019 revenue outlook in today’s press release, post-closing, we continue to believe the combined company has an attractive growth profile and a multi-year profitability improvement opportunity.”

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