Senzime AB's Share Structure Shake-Up: A Strategic Move for Long-Term Growth

Senzime AB (publ) has taken a bold step in reshaping its capital structure and governance framework, one that could redefine its trajectory in the competitive medical technology sector. In June 2025, the company executed a directed share issue, raising SEK 110.4 million through the issuance of 24 million shares at SEK 4.60 per share—a price aligned with its closing value on June 2. This move, coupled with corporate governance reforms approved at its annual general meeting, signals a strategic pivot toward aggressive expansion and long-term value creation. But is this the right play for shareholders? Let's break it down.

The Share Issue: Balancing Dilution and Growth

The directed share issue, split into two tranches, was designed to bypass standard shareholder pre-emption rights—a controversial but calculated decision. Tranche 1 (23.3 million shares) was oversubscribed, with 22.25 million shares already allocated to a mix of new institutional investors (e.g., Unionen, Protean) and long-term backers like the Crafoord family. Tranche 2 (700,000 shares) was reserved for board member Adam Dahlberg, who abstained from the decision-making process to avoid conflicts.

Critics may balk at the 15.27% dilution, but the board's rationale is clear: securing capital from “strong and reputable investors” at a premium to market value. The subscription price of SEK 4.60—just 1.5% below the June 2 closing price of SEK 4.67—avoided the dilutive hit of a discounted rights issue. For Senzime, this is a win. The capital will fund U.S. expansion, R&D for next-gen TetraGraph® systems, and operational scaling, all critical to capitalizing on its 100% sales growth in the U.S. and doubling of disposable sensor demand.

Governance Reforms: Building a Stronger Foundation

Beyond the share issue, Senzime's 2025 annual general meeting delivered governance upgrades that align with its growth ambitions. The re-election of Adam Dahlberg as vice chairman and the appointment of Ann Costello—ex-Roche Diagnostics—to the board underscore a focus on seasoned leadership. Costello's expertise in medical tech commercialization is a strategic asset as Senzime targets U.S. healthcare systems, where it now operates in 200 hospital systems.

The board also introduced a performance-based remuneration structure for directors, tying incentives to long-term value creation. This is a welcome shift for investors wary of short-termism. By aligning executive pay with metrics like EBITDA growth and market share expansion, Senzime is sending a message: the focus is on sustainable, not just headline-driven, results.

Strategic Implications: A Path to Positive Cash Flow

The funds raised will accelerate Senzime's march toward profitability. With 4,100 TetraGraph® systems deployed globally and utilization rates climbing (some hospitals now use seven sensors per week per unit), the recurring revenue model is proving sticky. The U.S. remains the crown jewel: local currency sales surged 101% in Q2 2025, driven by contracts with major healthcare systems and a new partnership with a Texas university hospital.

The company is also hedging its bets. It's lobbying to exempt medical devices from U.S. tariffs, which have nibbled at gross margins, while passing price increases to offset costs. Meanwhile, regulatory approvals in Japan and South Korea loom on the horizon, opening new revenue streams. The TetraGraph®'s integration into patient record systems further cements its value proposition, as hospitals increasingly prioritize data-driven care.

Risks and Rewards

The key question for investors is whether the dilution is justified. A 15% reduction in ownership stakes is significant, but the math checks out: Senzime's EBITDA turned positive in Q2 2025, and the company now holds TSEK 132 billion in cash. If the capital fuels a 30% CAGR in revenue over the next three years (as management projects), the dilution becomes a small price for exponential growth.

However, execution risk remains. The TetraGraph®'s success hinges on continued adoption in high-margin markets and the timely release of pediatric guidelines favoring EMG-based monitoring—a sector Senzime dominates. Delays in regulatory approvals or a slowdown in U.S. hospital spending could dampen momentum.

The Verdict: Buy for the Long Haul

For long-term investors, Senzime's share and governance reforms present a compelling case. The directed issue has fortified its balance sheet, diversified its shareholder base, and aligned leadership with growth objectives. The TetraGraph®'s recurring revenue model, coupled with a robust patent portfolio (107 patents), creates a durable competitive moat.

Yes, the dilution stings. But in a sector where R&D and regulatory hurdles are as critical as capital, Senzime is playing the long game. If the company can maintain its 90% year-over-year sales growth and scale its U.S. operations, the shares could double in the next 18–24 months. For those willing to ride the wave of medical tech innovation, Senzime is a buy—but keep a close eye on its EBITDA trajectory and U.S. expansion progress.