Neuronetics, a Pennsylvania-based developer of non-invasive treatments for psychiatric disorders, has agreed to acquire Greenbrook TMS, a Canadian provider of outpatient depression treatment.
The all-stock deal is set to create a vertically integrated organisation with enhanced scale for transcranial magnetic stimulation (TMS) therapy delivery.
Neuronetics provides NeuroStar TMS therapy, a treatment for depression.
Greenbrook, on the other hand, operates outpatient centres that offer TMS therapy for depression. The company also offers Spravato (esketamine nasal spray), a US Food and Drug Administration (FDA)-cleared, non-invasive treatment for major depressive disorder (MDD) and other mental health conditions in the US.
Greenbrook president and CEO Bill Leonard said: “By combining Neuronetics’ innovative NeuroStar platform as well as their education and training expertise, with Greenbrook’s well established practice operations and support capabilities, we believe the combined company can improve care at Greenbrook’s existing sites and, just as importantly, at any practice across the country that is looking to bring the benefits of NeuroStar to their patients.”
As per the terms of the deal, Greenbrook’s shareholders will exchange each of the shares in the company for 0.01149 shares of Neuronetics’ common stock. Following the transaction, Neuronetics’ shareholders will hold approximately 57% of the combined company, while Greenbrook’s shareholders will hold around 43%.
The combined entity will operate as Neuronetics and will retain the ticker symbol STIM on the Nasdaq stock exchange. After the transaction closes, Neuronetics plans to delist Greenbrook’s common shares from the OTCQB.
The transaction will proceed under the Business Corporations Act (Ontario) and requires approval from the Superior Court of Ontario.
The acquisition is intended to increase brand awareness for NeuroStar TMS through unified marketing, improve operational consistency, and provide centralised services to NeuroStar customers.
Neuronetics president and CEO Keith Sullivan said: “This transaction brings together two of the leaders in the mental health space in the US, which will allow us to provide access to innovative care to patients suffering from mental health conditions.
“Leveraging the significant scale and capabilities of the two businesses, we can drive increased awareness of NeuroStar, consistently deliver best practices, facilitate improved reimbursement on a regional and national level, and provide additional services and training opportunities to all of our customers which can improve their business operations.”
The transaction is expected to close in Q4 2024, pending shareholder and court approvals and other customary conditions.
Canaccord Genuity is acting as financial adviser to Neuronetics, with Ballard Spahr and Stikeman Elliott providing legal counsel. A.G.P./Alliance Global Partners is serving as financial adviser to Greenbrook, and Torys is providing legal counsel.
Separately, Neuronetics announced its financial results for Q2 2024, revealing revenue of $16.5m, a 7% decrease compared to the second quarter of 2023.
