Five Canadian tech companies have recently made acquisitions, including Converge Technology Solutions, WeCommerce, Carebook, Deloitte Canada, and Mednow. Here’s the latest on Canada’s movers and shakers.
Converge acquires majority stake in REDNET AG
Toronto’s Converge Technology Solutions has acquired a 75 percent interest in REDNET AG, a Germany-based IT services provider for about $141.7 million CAD (€96 million) in cash plus an adjustment for working capital. The purchase agreement enables Converge to acquire the remaining 25 percent of REDNET AG after three years.
The transaction represents Converge’s 23rd acquisition to date. According to Converge, the deal marks the onset of the Toronto-based company’s previously announced European expansion, and will “greatly increase” the firm’s ability to serve clients across the world. Converge financed its acquisition of REDNET AG using capital from its June bought deal offering, through which it secured gross proceeds of $172.5 million.
Converge was founded in 2017 to build a national platform of regionally-focused IT infrastructure firms across Canada and the United States. The highly-acquisitive, TSX-listed firm offers a variety of digital infrastructure solutions, ranging from data analytics to cloud and cybersecurity services. In June, Converge announced plans to acquire Vicom Infinity and Infinity Systems Software.
WeCommerce to acquire Archetype Themes
Victoria-based holding company WeCommerce has reached a deal to acquire all of the assets of Toronto’s Archetype Themes for up to $40.25 million CAD ($32 million USD). The purchase price consists of $20 million USD payable upfront, plus contingent consideration of up to $12 million USD.
Archetype designs and develops premium themes for Shopify merchants. According to WeCommerce, Archetype’s themes are used by over 60,000 Shopify merchants, and the company’s Impulse theme is the most popular option available in the Shopify Theme Store.
The acquisition is expected to close in the next 45 days. WeCommerce plans to fund the upfront cost through cash on hand and borrowings under its senior secured credit facility, and finance the earn-out to be paid either in cash or the issuance of Class A common shares of WeCommerce. Post-acquisition, Archetype will continue to operate as an independent brand.
Founded in 2019, WeCommerce is a holding company focused on building, acquiring and investing in SaaS and digital goods and services businesses that build apps, themes, and run agencies that support Shopify merchants. WeCommerce recently closed a $33.7 million bought deal financing to acquire more Shopify ecosystem companies. Following the acquisition of Archetype, WeCommerce said WeCommerce-owned themes will comprise five of the top-seven most popular paid themes in the Shopify Theme Store.
Carebook acquires CoreHealth
CoreHealth offers a platform that supports health and wellness programs for corporate wellness companies, major insurers, human resources consulting firms, employee assistance program providers, health systems, population health management providers, group benefit brokers, health coaching providers, and large employers. Carebook financed the acquisition through a recent $11.28 million CAD brokered private placement.
Carebook agreed to pay a base purchase price of $9 million CAD on a cash free and debt free basis, subject to customary post-closing adjustments. For Carebook, CoreHealth is a strategic add, as the company brings over $3 million in annualized revenue, ownership of “strategically significant” technology, and a customer base of over two million license holders worldwide.
Founded in 2012, Carebook offers digital health and virtual care solutions to pharmacies, employers, and insurers. The company currently trades on the TSX Venture Exchange (TSXV) under the symbol ‘CRBK.’ Carebook also recently acquired InfoTech, which operates as Wellness Checkpoint.
Deloitte Canada acquires Dataperformers
Founded in 2016, Dataperformers is an early-stage engineering and applied artificial intelligence (AI) startup. Dataperformers Macula AI platform offers end-to-end, AI-powered computer vision solutions for visual inspection.
Deloitte said Dataperformers brings “an experienced team of new and highly sought-after Montreal-based talent in the AI and computer vision space.” The company’s team is set to join Deloitte’s Omnia AI business in offices across Canada.
Dataperformers’ co-founders, CEO Mehdi Merai and COO Amine Ben Ayed, are joining Deloitte as partner and director, respectively. The startup’s CPO Ali Elawad and CTO Gabriel De Lisi will also join Deloitte as senior managers.
Deloitte said the deal will increase the firm’s capabilities in AI and machine learning, particularly in computer vision and machine learning operations. The Dataperformers acquisition follows Deloitte’s recent deals to acquire Clockwork, Groundswell Group, and TWG.
Mednow acquires Medvisit
Toronto’s Mednow, which offers an on-demand virtual pharmacy, has acquired Medvisit for up to $2 million. The purchase price consists of $1.32 million in cash at closing and a conditional earn-out of up to $680,000, subject to Medvisit’s achievement of profitability milestones.
According to Mednow, Medvisit, which focuses on the Greater Toronto Area, is “Canada’s largest and longest standing doctor house call service.” Medvisit conducts around 30,000 patient home visits per year, having served over 400,000 patients since its inception. During the last fiscal year, Medvisit earned revenue of approximately $3 million, for a gross profit of approximately $790,000.
Mednow went public on the TSXV earlier this year, securing $37 million CAD. The company said its acquisition of Medvisit bolsters Mednow’s holistic healthcare offering for patients, which currently includes pharmacy services, telemedicine and mental health assessment.
Through the Medvisit patient network, Mednow said it is now “well positioned to offer a full platform of service” to a large subset of patients that can benefit greatly from a full suite of digital healthcare and delivery services.” The firm added that the Medvisit acquisition highlights Mednow’s “continuing approach to accelerating our strategy through both organic development and mergers and acquisitions.”