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LITTLETON, Colo. - Vivos Therapeutics, Inc. (NASDAQ:VVOS) announced Wednesday it has completed the acquisition of The Sleep Center of Nevada (SCN), the largest operator of medical sleep centers in Nevada, for $6 million in cash and $1.5 million in company stock. The acquisition represents a significant move for the company, which currently has a market capitalization of $12.43 million. According to InvestingPro analysis, Vivos is currently trading below its Fair Value, though investors should note the company’s challenging financial health metrics.
The transaction marks the completion of Vivos’ strategic pivot from focusing on dental providers to collaborating with or acquiring medical sleep practices. This shift allows the company to generate revenue from both sleep disorder diagnosis and its FDA-cleared obstructive sleep apnea (OSA) treatments.
SCN sees approximately 3,000 new patients monthly across seven locations with nearly 50 beds for overnight testing. According to the company, about 90% of SCN patients test positive for OSA or other sleep disorders.
Board-certified sleep specialists Dr. Prabhu Rachakonda and Dr. Tara Rachakonda will join Vivos while continuing to manage the practice they founded.
To finance the acquisition, Vivos secured an $8.2 million senior secured term loan from Streeterville Capital LLC, with $7.5 million in gross proceeds. The 18-month loan bears a 9% annual interest rate. Additionally, New Seneca Partners, an existing investor, provided $3.75 million through a private placement investment. InvestingPro data reveals the company’s current ratio of 0.77 indicates potential liquidity challenges, with short-term obligations exceeding liquid assets. Subscribers to InvestingPro can access 13 additional key insights about Vivos’s financial position and growth prospects.
"We started booking SCN patients over the past few weeks in anticipation of closing, and we are already fully booked out for the entire month of June and into late July," said Kirk Huntsman, Vivos’ Chairman and CEO, in the press release.
Vivos plans to equip additional SCN locations over the next 12 to 18 months to offer its treatment options. The company expects diagnostic and treatment revenues from the acquisition to increase as more locations are integrated.
An additional $1.5 million in Vivos common stock may be earned if SCN achieves agreed financial milestones. Vivos will manage SCN under agreements designed to comply with corporate practice of medicine laws. With current annual revenue of $14.63 million and a gross profit margin of 58.73%, the acquisition could significantly impact the company’s financial profile. For detailed analysis and comprehensive insights, investors can access the full Pro Research Report available on InvestingPro, which covers over 1,400 US stocks including Vivos.
In other recent news, Vivos Therapeutics reported its first-quarter 2025 financial results, showing a decrease in revenue to $3 million from $3.4 million in the previous year. Despite this drop, product sales grew by 8%, reaching $1.8 million, attributed to strong performance in their Pediatric Guide Appliance Line. The company also highlighted its strategic focus on acquisitions, including the upcoming acquisition of the Sleep Center of Nevada, which is expected to be accretive in the third quarter of 2025. Vivos Therapeutics has obtained FDA clearance for treating severe Obstructive Sleep Apnea in adults, marking a significant development in their service offerings.
The company announced the appointment of Baker Tilly as its new independent registered public accounting firm following a merger with Moss Adams, its previous auditor. This change was approved by Vivos Therapeutics’ audit committee and was disclosed in a Form 8-K filed with the SEC. Additionally, there were no disagreements or reportable events during Moss Adams’ tenure as the auditor. Analysts have not revised the earnings per share (EPS) forecast, which remains at a loss of -0.41, aligning with the company’s historical trends.
Vivos Therapeutics is actively pursuing strategic alliances and acquisitions, aiming to expand its presence in the sleep medicine market. The company’s recent developments underscore its strategic pivot towards acquisitions and partnerships, with expectations of improved financial performance in the near term.
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