GC Aesthetics breast implant firm may raise $75m in US IPO
Bill McCabe backed group files for US flotation to fund major growth plan
GC Aesthetics, a Sandyford breast implant manufacturer backed by e-learning pioneer Bill McCabe, is to float on the Nasdaq.
It has been suggested that the firm may raise over $75m from investors. BofA Merrill Lynch, Deutsche Bank and Cowen & Company are the joint bookrunners on the IPO. The company raised $60m from investors including private equity group Montreux in March last year, having previously raised $30m in an funding round back in 2010.
In a prospectus filed with the US Securities Exchange Commission, the company says it wants to become "the trusted brand and partner for women seeking to look healthy, youthful, vibrant and beautiful, and to feel confident about themselves throughout their lifetime."
The company's CEO, Ayse Kocak told the Sunday Independent that floating on the stock market would help it achieve its vision more quickly. "Our vision... certainly requires that we expand our existing business, and add other female aesthetic products to our portfolio.
"We've had very healthy growth in 2014 and also in the first quarter of 2015. And we're going to invest to continue that growth, we're going to invest in our salesforce and different marketing programmes that we have out there.
"We've filed our prospectus and the SEC is going to review it. They need to approve it before we can actually get on the road and start talking to investors. We're hoping as soon as possible, but we can't give a date for when the company will float. I wish I knew.
"Our goal is to serve our customers in the best possible way and we're also going to be looking into improving the way we serve our customers, this could be putting in more call centres and a couple of other things that we do."
Kocak said Korea, China and Thailand are markets where the company will seek to expand. She praised McCabe's contribution to the company.
"Bill is great. He's been on the board of the company since I joined as CEO. He's a fantastic entrepreneur. I'm really happy to have Bill on board. He's an important shareholder for us.
"Certainly we're seeing market growth in the breast implant field. This market growth is different from region to region, we tend to see higher growth in Latin America and Asia-Pacific markets than in Europe.
"In the overall aesthetics market there is meaningful growth, and I think this is driven by a couple of things. One is that female disposable income is increasing and I think they have more money for these procedures or these products. I think secondly, the perception of aesthetics is also changing.
"I don't have the data specifically for the Irish market, but I wouldn't say it's one of the largest or highest growing."
In its SEC filings, the company says it has a "diversified revenue base", with almost half of its 2014 sales figure of $52.8m coming from Europe, the Middle East and Africa.
Around 42pc came from Latin America and 11pc from the Asia-Pacific region. Revenues jumped 18pc on 2013, but overall the company lost $89.4m. It had an accumulated deficit of $183.5m as of the end of last year.
"The global aesthetics products market in 2014 was estimated at $6.5bn in total sales and is expected to grow at a CAGR (compound annual growth rate) of nearly 12pc, reaching almost $10.2bn in total sales by 2018, according to Medical Insight," the prospectus says.
"We believe the overall market growth is driven by multiple factors, including a growing middle class, increasing female disposable income and increasing awareness and acceptance of aesthetics procedures, as well as continuous innovation and improved accessibility to aesthetics procedures, through an increase in the number of surgeons," the document reads.
"The number of middle- and upper-income women globally is forecasted to grow at a CAGR of approximately 5pc from 2014 to 2019 to 346 million, according to industry sources."
The prospectus says new products the company plans to launch this year include a specialised bra that "allows women to experience the look and feel of fuller breasts instantly". "We believe this will lead to an increase in the number of women considering surgical augmentation and consulting surgeons," the company said.
The company also plans to launch a gel product that is designed to minimise the appearance of post-surgery scars.
Risk factors identified in the prospectus include recent studies that questioned the long-term safety of breast implants, and the "significant net operating losses" that the company says cannot assure investors that the company will ever achieve or maintain profitability.
Belfast-born McCabe is one of this country's most successful technology entrepreneurs. He floated e-learning company CBT on the NASDAQ and his Oyster investment group has taken stakes in companies like Fieldaware, Muzu.Tv, Complete Telecom and Data Hug.
He has also invested in property through LNC Properties which has been active in Germany and the UK, and was ranked 84th on the Sunday Independent rich list for 2015.
Sunday Indo Business