Ai-Media targets $65.5 million IPO to capture growing market opportunities
Ai-Media plans to make its ASX debut in mid-September.
Cloud-based captioning and transcription service Ai-Media (Access Innovation Holdings) is hoping investment market confidence will underpin its next phase of growth as it seeks to raise $65.5 million through an initial public offering (IPO) and subsequent listing on the Australian Securities Exchange.
The underwritten offer will be based on a $1.23 share price, to give the 17-year old Australian company a total enterprise value of $157.6 million and an indicative market capitalisation of $177.4 million when it hits the boards next month under the ticker ‘AIM’.
It will comprise the issue of approximately 24.4 million new shares to raise $30 million before costs and a secondary offer of 28.8 million shares to existing investors for a total consideration of $35.5 million.
Ai-Media chair Deanne Weir said the capital raising will help the artificial intelligence-driven business continue its international expansion and grow its technology platform.
“The primary purpose of this offer is to provide [us] with financial flexibility to fund our future plans including marketing, product development, operations and other growth opportunities,” she said.
“It will provide us with access to capital markets, provide a liquid market for shares, allow some investors to realise part of their investment, provide working capital and assist us to attract and retain quality employees,” Ms Weir added.
Key provider
Ai‐Media was founded in 2003 with the simple goal of making it easier for people who are deaf or have difficulty hearing to view recorded television media.
It has grown to become a global access provider of live and recorded captioning, transcription, subtitles, translation and speech analytics using a proprietary, cloud‐based technology platform powered by artificial intelligence and machine learning.
Today, Ai-Media operates worldwide across three key product lines of “Live Enterprise”, “Live Broadcast” and “Recorded” with the capacity to make content available in over 120 languages (six of which are actively used).
Its customer base includes over 2,200 international and national broadcasters, streaming content providers, multi-national corporations, government organisations, schools, universities, small businesses and individuals.
During the 2020 financial year, Ai‐Media acquired US-based speech‐to‐text captioning and sign language provider Alternative Communication Services, significantly increasing its presence across North America and giving it the opportunity to migrate Alternative’s customers to its own platform.
Global market
In a report commissioned by Ai‐Media, industry research company Frost & Sullivan estimated the global market size for all language services to be $75.2 billion in 2019, growing to approximately $93.4 billion in 2022, representing an estimated compound annual growth rate (CAGR) of 8.4%.
For 2020, Ai-Media’s total addressable market has been forecast at around $16.4 billion, increasing to $20.5 billion by 2022 at a CAGR of 7.4% between 2015 and 2022.
The market is being driven primarily by a significant growth in media consumption, particularly online videos, which is driving new production and in turn, stimulating demand for language services.
Globally, the market for video content – including cinemas, DVDs, video-on-demand, and free-to-air and pay TV – reached around $683 billion in 2019.
Other market drivers include a combination of globalisation and localisation, and regulatory requirements mandating equality of access to content for the hard‐of‐hearing community.
More recently, COVID‐19 has promoted remote working, which has led to increased demand for live captioning of online meetings and webinars.
Platform development
Since 2009, Ai-Media has spent more than $50 million on the development of its platform to address growing market opportunities, enabling the conversion of live and recorded speech-to-text efficiently and with greater than 99% accuracy.
“The combination of machine and human curation provides levels of accuracy which are greater than machines alone [and is] required to service our enterprise customers,” Ms Weir said.
“Our continued investment will increase automation, further improve accuracy, efficiency and security, enable more training data to be captured, and provide continued improvement in the management of [our] global crowd,” she added.