Q4 Inc. delists from TSX as Sumeru Equity Partners buyout closes

Just over two years after TSX IPO, Q4 Inc. becomes the latest Canadian tech company to go private.

Toronto-based investor relations software company Q4 Inc. has been delisted from the Toronto Stock Exchange (TSX) and is now once again a private company.

Q4 Inc. has joined a growing list of Canadian tech companies going private following a pandemic-era IPO. 

The company’s $257-million CAD buyout agreement with Sumeru Equity Partners closed last Thursday, allowing Sumeru to acquire all issued and outstanding shares of Q4 Inc, other than those held by the “rolling shareholders” that will join the new ownership structure, at the agreed-upon price of $6.05 per common share.

The deal was approved by shareholders on January 24  despite some dissent from Finsight Group, which owned roughly 5.6 percent of Q4 Inc. and believed the buyout undervalued the company, according to The Globe and Mail.

While the final price marked a 36 percent premium on Q4 Inc.’s share value before the announcement of a buyout agreement on November 10, it represents about half of the company’s October 2021 initial public offering (IPO) issue price of $12 per share.

“The successful completion of this transaction marks another significant milestone for Q4,” Q4 Inc. founder and CEO Darrell Heaps said in a statement. “As we embark on this new chapter with our new sponsor, Sumeru Equity Partners, we are united by our shared mission to connect the capital markets.”

Since Q4 Inc. is no longer listed on the TSX, the company said it will apply to cease to be a reporting issuer under Canadian securities laws and to terminate its public reporting requirements.

In going private, Q4 Inc. has joined a growing list of Canadian tech companies to become privately held once again after going public during the pandemic. 

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This list includes media tech firm BBTV Holdings, which faced difficulties after going public in October 2020 before reaching a deal to go private in October 2023. BBTV closed that transaction on January 11 and delisted its shares the same day. 

Meanwhile, Montréal-based Dialogue Health Technologies, which went public in 2021 but saw its stock price fall post-IPO, was acquired by Sun Life Canada last year and taken private.

In 2023 alone, asset management firm mCloud and AgTech company Farmers Edge participated in go-private talks while digital pharmacy Mednow has actively sought a buyer. 

While the IPO market has been volatile in recent years, some believe that tech companies are primed to lead the way when the market eventually rebounds. 

“We actually have a great IPO pipeline, but the timing is a little uncertain because IPOs are once in a lifetime for a company, and they want to make sure that their business is performing well and that the economic outlook is very strong,” CIBC Capital Markets’ head of equity capital markets Tyler Swan told The Globe and Mail last month. 

Feature image courtesy Q4 Inc.

Alex Riehl

Alex Riehl

Alex Riehl is a staff writer and newsletter curator at BetaKit with a Bachelor of Journalism from Carleton University. He's interested in tech, gaming, and sports. You can find out more about him at alexriehl.com or @RiehlAlex99 on Twitter.

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