Afya Limited Announces the Acquisition of Shosp

Rhea-AI Summary

Afya Limited (Nasdaq: AFYA) has acquired 100% of Shosp, a Brazilian clinical management software provider, for R$5.98 million in cash. Shosp, which has over 450 clinics and 2,800 active users, generates an annual recurring revenue (ARR) of R$1.8 million. The migration of Shosp's users to iClinic’s platform aims to enhance Afya's revenue cycle management. An additional earn-out of R$1.793 million is possible based on user migration and new feature implementations within 24 months.

Positive

• Acquisition of Shosp enhances Afya's digital capabilities and expands its user base.
• Shosp's integration is expected to improve revenue cycle management in iClinic.
• Shosp generates an ARR of R$1.8 million, contributing positively to Afya's financials.

Negative

• The entire purchase price was funded in cash, impacting Afya's liquidity.
• Dependence on earn-out payments could pose risks if performance targets are not met.

NOVA LIMA, MINAS GERAIS, Brazil, May 13, 2021 (GLOBE NEWSWIRE) -- Afya Limited, or Afya (Nasdaq: AFYA) today announced the acquisition of 100% of the total share capital of Shosp, a clinical management software that offers all functionalities needed for clinics all over Brazil to manage their financials, patients appointments, medical records, marketing, and others.

Shosp as of today has more than 450 clinics associated with 2,800 monthly active users, of which 1,937 are monthly active subscribers, with more than 3 million consultations since inception, generating an ARR (Annual Recurring Revenue) of R$ 1.8 million.

Shosp users will be migrated to iClinic’s platform to create a unique offering of clinical management software and Shosp team will join Afya’s digital capabilities to contribute to the improvement of iClinic’s revenue cycle management module.

The aggregate purchase price (enterprise value) paid to sellers was R$5.98 million, of which 100% was paid in cash. An earn-out of up to R$1.793 million can be paid related to the migration of Shosp users and and implementation of some new functionalities in iClinic’s platform in up to 24 months, starting in the date hereof.

About Afya

Afya is a leading medical education group in Brazil based on number of medical school seats, delivering an end-to-end physician-centric ecosystem that serves and empowers students and physicians to transform their ambitions into rewarding lifelong experiences from the moment they join us as medical students through their medical residency preparation, graduation program, continuing medical education activities and offering digital products to help doctors enhance their healthcare services through their whole career.

Contact: Investor Relations: ir@afya.com.br

FAQ

What is the purpose of Afya's acquisition of Shosp?

The acquisition aims to enhance Afya's digital capabilities and expand its clinical management software offerings.

How much did Afya pay for the acquisition of Shosp?

Afya paid R$5.98 million in cash for the acquisition.

What is the expected impact of the Shosp acquisition on Afya?

The acquisition is expected to improve revenue cycle management and increase Afya's user base.

What are the financial metrics associated with Shosp?

Shosp has over 450 clinics, 2,800 active users, and generates an ARR of R$1.8 million.