BANNER DAY FOR DIALOGUE
$940M milestone in trading debut
Tuesday was a banner day for Dialogue Health Technologies Inc., and chief executive Cherif Habib is out to make sure other milestones lie ahead.
Dialogue shares jumped about 21 per cent to $14.49 Tuesday in their trading debut on the Toronto Stock Exchange.
The initial public offering, which allowed Dialogue to raise $100 million, gives the Montreal-based provider of telemedicine a market value of about $940 million.
Habib, who founded Dialogue with two partners in 2016, has built a business that allows employers to offer their workers health and wellness programs through the company's application.
Annual sales, which have at least doubled every year since Dialogue was created, are set to top $60 million this year from last year's $36 million, the company said in a regulatory filing last week.
“We could have raised the money from private investors, but we decided to go to the public markets because in addition to the cash, we also get a great currency for mergers and acquisitions,” Habib said by phone Tuesday. “M&A is a big part of our strategy. In our analysis, the upside of having access to the capital markets, of having that
M&A currency and brand recognition, outweighs the costs of going public.”
Dialogue's business has benefited as interest in telemedicine
soared during the pandemic.
As remote work became mainstream, many Canadians sought ways to curb contacts and reduce their exposure to the virus.
COVID-19 “has accelerated a trend that was already happening,” Habib said. “We think it brought forward by two to three years the adoption of virtual care — 2020 was a great year, but it was certainly not an outlier in terms of growth.”
Having successfully integrated four acquisitions in Canada and Germany over the last three years, Dialogue plans to focus on its two main markets as it hunts for the next transaction, Habib said.
“Today we have a pipeline of about a dozen opportunities that we are looking at,” he said.
“Right now we're really focused on our two markets. Obviously we're very strong in our home market, and Germany is the largest economy in Europe. Later on, when we feel like we're very well implanted in those two countries, we'll look elsewhere.”
While pandemic-era travel restrictions make the process of planning acquisitions a little more complicated, work continues apace.
“We get to spend a lot of time with the targets over Zoom,” Habib said. “Hopefully in the next few months as restrictions are lifted, we'll be able to meet them in person.”
Habib and his team are becoming quite adept at Zoom meetings, having completed the customary pre-IPO road show without meeting a single institutional investor in person.
“Our company is all about doing things virtually that in the past were done in person, so doing this IPO process virtually was very fitting,” the CEO said.
“We were able to meet a huge number of investors from our homes, and got to spend perhaps more time with them and run a more efficient process.”