Q4 prices downsized $100M IPO at $12 a share for up to $526M valuation

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By CPE News

CPE News (10/22/2021) – Q4 Inc. has priced its proposes initial public offering (IPO) of its common shares and secondary offering if the over-allotment option is exercised.

Q4 Inc. will issue 8,334,000 common shares priced at $12.00 per common share for gross proceeds of $100,008,000. If the over-allotment option is exercised, a secondary offering
of up to 83,334 common shares held by Darrell Heaps and up to 1,166,766 additional common shares from Q4 for additional gross proceeds of up to $1,000,008 and $14,001,192 to Heaps and Q4 respectively.

Certain shareholders including Ten Coves Capital Entities intend to purchase an aggregate of $9.5 million of common shares under the offering, $5.625 million of which will be purchased by Ten Coves Entities.

Concurrently with the completion of the offering, Q4 will issue 11,119 additional common shares on the same terms as the offering by way of private placement to certain eligible directors, officers and employees and business partners and other purchasers residing or located outside Canada.

Q4 has previously anticipated to issue between 8,571,428 and 10,714,285 common shares (9,857,142 and 12,321,427 common shares, including approximately 287,428 to 359,285 common shares on a secondary basis, if the over-allotment option is exercised in full), at between $14.00-$17.50 per common share for gross proceeds of $150 million.

Q4 initially anticipated to issue common shares to be priced between $10.50 and $13.00 for gross proceeds of $150 million.

Immediately following the closing of the offering and the concurrent private placement, Q4 will have 39,609,654 common shares issued and outstanding on a non-diluted basis (42,700,171 common shares on a fully diluted basis), and if the over-allotment option is exercised in full, 40,776,420 common shares issued and outstanding on a non-diluted basis (43,866,937 common shares on a fully diluted basis).

Q4 will be valued up to at $526 million on fully diluted basis.

Q4 shares are expected to commence trading on the TSX under symbol “QFOR” on October 25, 2021. The offering is expected to close on or about October 29, 2021.

Q4 has been backed by Ten Coves Capital (formerly Park Financial Partners), First Ascent Ventures (formerly OpenText Enterprise Apps Fund (OTEAF)), Information Venture Partners, Plaza Ventures, Accomplice, CIC Capital Ventures (formerly Emerillon Capital), HarbourVest Partners, Kensington Capital Partners, and Espresso Capital.

Prior to the closing of the offering, Ten Coves Entities and Heaps own 9,808,088 shares and 1,940,986 shares respectively. Following the closing of the offering, Ten Coves Entities will own 10,276,838 shares while Heaps will own 1,940,986 shares (no exercise of over-allotment option) or 1,857,652 shares (full exercise of over-allotment option).

Toronto based Q4 is a leading capital markets communications platform for publicly traded companies, investors and investment banks.

With offices in New York and London and Toronto, Q4 had 394 employees as of December 31, 2020 (Q4 did not provide update for the employee figure as of June 30, 2021).

For the year ended December 31, 2020, Q4 reported $40.4 million in revenues, $21.7 million in gross profit, $12.2 million in loss from operations, and $13.1 million in net loss. For the six months ended June 20, 2021, Q4 reported $28.6 million in revenues, $16.0 million in gross profit, $10.6 million in loss from operations, and $14.6 million in net loss.

photo credit: Q4

Q4 Inc. Announces Pricing of Initial Public Offering


October 22, 2021 04:45 PM Eastern Daylight Time

TORONTO–(BUSINESS WIRE)–Q4 Inc. (“Q4” or the “Company”) today announced that it has filed, and obtained a receipt for a final long form prospectus with the securities regulatory authorities in each of the provinces and territories of Canada and has entered into an underwriting agreement in respect of its previously announced proposed initial public offering of common shares (the “Offering”).

The Offering consists of a treasury offering of 8,334,000 common shares of the Company at a price of $12.00 per common share, for gross proceeds of approximately $100 million. The Company and a member of Company management (the “Selling Shareholder”) have also granted to the underwriters an over-allotment option (the “Over-Allotment Option”), exercisable, in whole or in part, at any time for a period of 30 days following the closing of the Offering, to purchase up to an additional 1,250,100 common shares at the offering price, for additional gross proceeds of up to $14 million to the Company and up to $1 million to the Selling Shareholder, if the Over-Allotment Option is exercised in full. The Company will not receive any proceeds from the sale of common shares by the Selling Shareholder.

The Offering is being made through a syndicate of underwriters led by CIBC Capital Markets, National Bank Financial Inc. and Credit Suisse Securities (Canada), Inc. (together, the “Joint Bookrunners”), and including Canaccord Genuity Corp., Raymond James Ltd., RBC Capital Markets, Stifel Nicolaus Canada Inc., TD Securities Inc. and INFOR Financial Inc.

The closing of the Offering is expected to occur on or about October 29, 2021 and is subject to customary closing conditions, including receipt of all necessary regulatory approvals. The Toronto Stock Exchange (the “TSX”) has conditionally approved the listing of the common shares, subject to the fulfillment by the Company of customary TSX requirements. The common shares are expected to begin trading on the TSX on an “if, as and when issued” basis on October 25, 2021 under the symbol “QFOR”.

This Offering is only made by prospectus. A copy of the Company’s final prospectus has been filed on SEDAR at www.sedar.com. The prospectus contains important information about the securities being offered. Copies of the prospectus may be obtained from CIBC Capital Markets, 161 Bay Street, 5th Floor, Toronto, ON M5J 2S8 by telephone at 1-416-956-6378 or by email at mailbox.canadianprospectus@cibc.com; from National Bank Financial Inc. 130 King Street West, 4th Floor Podium, Toronto, Ontario, M5X 1J9, by telephone at 416-869-6534 or by email at Ecm-origination@nbc.ca; from Credit Suisse Securities (Canada), Inc., 100 King Street West, Suite 2900, Toronto, ON M5X 1C9 by telephone at 1-416-352-4594 or by email at neha.rastogi@credit-suisse.com. Investors should read the prospectus before making an investment decision.

No securities regulatory authority has either approved or disapproved the contents of this news release. This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities of Q4 in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities offered have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any U.S. state securities law and may not be offered or sold in the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws or pursuant to an exemption therefrom.

About Q4 Inc.

Q4 Inc., is a leading capital markets communications platform that is transforming the way publicly traded companies, investors and investment banks make decisions to efficiently discover, communicate and engage with each other. The Q4 end-to-end technology platform facilitates interactions across the capital markets through its IR website products, virtual events solutions, capital markets customer relationship management solution, and shareholder and market analytics tools. The firm is a trusted partner to over 2,500 public companies including approximately 50% of the S&P 500 constituent companies. Q4 is based in Toronto, with offices in New York and London. To learn more, visit: www.q4inc.com.

Forward-Looking Statements

This news release may contain forward-looking information within the meaning of applicable securities laws, which reflect the Company’s current expectations regarding future events. Such information includes, but is not limited to statements related to the expected closing date of the Offering, the exercise of the Over-Allotment Option, and the date that trading of the Company’s common shares is expected to commence on the TSX. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company’s control. Such risks and uncertainties include, but are not limited to, failure to complete the Offering and the factors discussed under “Risk Factors” in the Company’s final long form prospectus. Actual results could differ materially from those projected herein. The Company does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required under applicable securities laws.

IR Contact: Matt Tractenberg, IR@q4inc.com
Media Contact: Karen Greene, media@q4inc.com