Mathieu Martin Oct 20, 2023 Covalon is a medical device company in the wound care space. They already ran a strategic review process in late 2020, which led to selling one of their divisions (Aquaguard) for $38 million in July 2021. At the time, the CEO mentioned that Aquaguard was their least attractive division, with the least amount of intellectual property, and that the remaining divisions were worth at least as much each. That would equate to a potential value of $76 million or more for the remaining two divisions.
The current market cap is roughly $36 million, and if you remove $9 million of net cash on the balance sheet, enterprise value is $27 million. Fundamentally, the business has also progressed since 2021, having grown revenues by 30% in the last twelve months.
With $25 million in LTM revenues, it's not too hard to imagine this business valued at a 3-4x revenue multiple or $75-100 million in enterprise value. Remember, Opsens just sold for close to a 7x multiple.