In what could be considered a positive development for the US equity capital markets after four key listings delivered mixed results, Waystar Holding Corp, a healthcare payments software firm backed by EQT Holdings Limited, filed for an initial public offering (IPO) on Monday.
In its filing with the US Securities and Exchange Commission (SEC), it was revealed that the company reported improved financial performance with growing revenue and shrinking losses. Waystar declared that last year, it had a net loss of $44 million on revenue of $705 million. For comparison, the company made a net loss of $47 million on revenue of $579 million in 2021.
The company, which was formed in 2017 through the merger of healthcare tech firms Navicure and ZirMed, did not include any specifics related to the proposed size and price range for a share sale in the document but the figures are expected to be revealed in due course with subsequent filing.
Some notable investors in Waystar include EQT Partners, Canada Pension Plan Investment Board, Fransisco Partners, and Bain Capital.
According to Reuters, Waystar has hired prominent Wall Street bankers JPMorgan Chase & Co, Goldman Sachs Group Inc, and Barclays Plc. as advisers for the initial public offering.
Healthcare Tech Startup Waystar Aims $8 Billion Valuation With IPO Listing
Waystar was among a new wave of companies that confidentially filed for an IPO late in August. This was after a months-long dry spell in the equities market where no listings were made due to interest rate hikes and fears of an impending recession in the US economy.
According to unnamed sources cited in the document, Waystar is eyeing a valuation of $8 billion with its IPO. The company, which provides health care services with software to better manage their finances, said it plans to list its shares on the Nasdaq Global Select Market under the ticker “WAY”.
The company also revealed that it had a profitable second quarter in 2023, with total sales for the three months ended June 30 coming in at $196 million, compared to $173.4 million during the same time last year.
Recent US IPO Failures Concern The Financial Market
Doubts still persist about the market as the shares of some recent high-profile entrants such as chip manufacturing giant Arm and grocery delivery firm Instacart have wobbled since their IPO debuts. Experts are concerned whether Waystar’s shares will go down the same path during a turbulent period for the market.
Just last week, Birkenstock Holding Plc. debuted its IPO, which has flopped hard. The Germany sandal maker’s shares remain 17% below its IPO price despite rising slightly at 4.6% on Monday.
Arm Holdings Plc, the biggest global IPO of the year at $5.23 billion, has reported gains of just 2.1% since making its debut in September. Data and marketing automation company Klaviyo Inc. is up 5.1%, while Instacart has fallen 17% below its debut price.
Barclays and Morgan Stanley are also leading the listing of Hamilton Insurance Group Ltd., which submitted its IPO filing with the SEC along with Waystar on Monday. Oil and gas producer Mach Natural Resources LP also filed an IPO set at a price of $19 to $21 for 10 million shares.
Waystar, in which EQT Partners and the Canada Pension Plan Investment Board hold a majority stake, processes 2.5 billion transactions on an annual basis for hospitals and clinics and has more than 1 million providers and 5,000 payer connections on its network.
Over the years, the medical fintech has acquired multiple companies, including talent acquisition firm eSolutions and Patientco – a technology company that provides PCI and HIPAA-compliant, cloud-based payment tools for healthcare providers, in an effort to grow its ever-expanding network.
Waystar is yet to reveal the price or the number of shares it will be listing on Nasdaq.