VIQ Solutions Inc. (“VIQ” or the “Company”) (TSX Venture Exchange: VQS and OTCQX Markets: VQSLF), a global provider of secure, AI-driven, digital voice and video capture technology and services, today announced acquisition of a leading US transcription provider, wordZXpressed, Inc. (“WordZ”) of Atlanta, Georgia, VIQ’s fifth accretive acquisition in 14 months. The WordZ acquisition definitive agreement was signed on February 26, 2020.
VIQ will host an investor conference call on Wednesday March 4 at 4:00 PM ET to discuss the recent strategic acquisitions, organic sales growth, and 2020 financial outlook.
Key transaction highlights include (all amounts in USD.):
- Acquisition expected to be immediately accretive to VIQ’s operating income and net earnings;
- Adds approximately $6 million in annualized recurring profitable revenue;
- Acquisition is non-dilutive;
- Adds over 100 clients including Fortune 500 insurance clients;
- Extends VIQ’s presence in $6 billion voice and video to text transcription market (as estimated by MarketsandMarkets.com);
- Adds approximatively 3 million minutes per year of highly secure single and multi-speaker audio and video content for transformation into verbatim transcripts and documentation;
- The Wordz acquisition and organic sales growth increases VIQs global footprint to US (69%), Australia (24%), EMEA and Canada (7%), supporting approximatively 1,300 clients across Insurance, Law Enforcement, Courts, and Government agencies.
“We continue building shareholder value through a combination of organic growth and accretive, strategic acquisitions. The WordZ acquisition will have a positive impact among Fortune 500 clients in the insurance industry, one of our core verticals, and add to our 2020 operating income and net earnings,” said Sebastien Paré, President and CEO, VIQ Solutions.
“We are very excited to partner with a global leader that brings together advanced technology and outstanding quality in both service delivery and the favorable outcomes customers experience with VIQ. Growth rate with net new customers and renewals confirm VIQ is clearly hitting the mark,” said Joel Turry, President, wordZXpressed, Inc. “Joining VIQ enables us to fast-track additional new technology and operational improvements to significantly increase our market penetration, create operational efficiencies, accelerate growth and further differentiate wordZXpressed from other transcription providers. This is a big win for our 28-year-old company. The WordZ team looks forward to working closely with all our customers as part of VIQ.”
The purchase price paid for the WordZ acquisition was $4.7 million, with $1.3 million paid in cash on closing, $1.2 million paid via a promissory note payable quarterly over 36 months and $2.2 million paid via an earnout payable quarterly over 36 months.
VIQ funded this acquisition through a drawdown of approximately $1.3 million in debt capital pursuant to a $11.5M debt facility (the “Debt Facility”) entered into on November 28, 2018 with Crown Capital Partner Funding, LP (“Crown”).
Conference call details:
Date: Wednesday, March 4 at 16:00 ET
Investors may join the conference call via telephone by dialing 1-833-231-8256 (Canada/US) or 1-647-788-4945 (international) and connect to the call by an operator using conference ID number 4089749. Participants should dial in at least 10 minutes prior to the start of the call.
A telephone replay will be available beginning on March 4th at 23:59 ET. To access the replay, please dial 1-855-859-2056 and follow the prompt with the passcode number 4089749. A recording of the call will also be available on VIQ’s website for replay for seven days following the call at https://viqsolutions.com/investors/.
For more information about VIQ, please visit viqsolutions.com.
About VIQ Solutions Inc.
VIQ Solutions is a global expert in video capture software and audio recording with voice-to-text capabilities. VIQ provides a cyber-secure AI technology and service platform to law enforcement, immigration, medical, legal, insurance, courts, and transcription service providers, enabling them to unlock the value of their enterprise digital media and streamline their document-creation workflow, using artificial intelligence tools for measurable business gains.
Certain statements included in this news release constitute forward-looking statements or forward-looking information under applicable securities legislation. Such forward-looking statements or information are provided for the purpose of providing information about management’s current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes. Forward-looking statements or information typically contain statements with words such as “anticipate”, “believe”, “expect”, “plan”, “intend”, “estimate”, “propose”, “project” or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking statements or information in this news release include, but are not limited to, management’s projections and targets regarding the performance of WordZ and the size of the Company’s market.
Forward-looking statements or information is based on several factors and assumptions which have been used to develop such statements and information, but which may prove to be incorrect. Although VIQ believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because VIQ can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this news release, assumptions have been made regarding, among other things, the Company’s recent initiatives, and that sales and prospects may provide incremental value for shareholders. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions that have been used.
Forward-looking statements or information is based on current expectations, estimates and projections that involve several risks and uncertainties which could cause actual results to differ materially from those anticipated by VIQ and described in the forward-looking statements or information. These risks and uncertainties may cause actual results to differ materially from the forward-looking statements or information. Readers are cautioned that the foregoing list is not exhaustive of all possible risks and uncertainties.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this release.