Quipt holder/suitor Forager rips "self-serving" board

Executive Summary

• Forager Capital Management, a 9.7% shareholder in Quipt Home Medical Corp., issued a public rebuttal to Quipt’s August 27, 2025, statements, accusing the Quipt board of self-serving tactics to entrench itself and avoid a sale.
• Forager maintains its all-cash acquisition offer of $3.10 per share, arguing it represents a 120% premium to the unaffected trading price and a 19x multiple of Free Cash Flow (FCF).
• The release details a breakdown in negotiations, citing Quipt’s failure to respond to multiple proposals, calls, and diligence requests over six months, culminating in Quipt suing Forager over an expired confidentiality agreement.

Key Details

• Acquisition Offer: Forager reiterates its commitment to an all-cash offer of $3.10 per share.
• Offer History: The offer was reduced from an initial $3.90 per share (submitted in January) to $3.10 to reflect a decline in Free Cash Flow and dilutive equity grants by the Quipt board.
• Valuation Metrics:
  • The $3.10 offer represents a 120% premium to the unaffected trading price.
  • It reflects a 19x multiple of Free Cash Flow (FCF), which Forager argues is a more reliable metric than EBITDA for Quipt.
  • Trailing 12-month FCF declined from $13.1 million (at time of initial offer) to $10.8 million.
• Shareholder Impact & Board Actions:
  • Forager claims the board’s strategy is to distract shareholders with "growth initiatives" (Ballad Health acquisition, Hart Medical JV) while the stock price declines.
  • On the day of the Hart Medical JV announcement, Quipt stock dropped 7%, while the Russell 2000 Index rose 3%.
  • The Quipt board issued approximately 7% of the company at $2.37 per share with automatic vesting upon a change of control, which Forager characterizes as dilutive and self-serving.
• Negotiation Breakdown:
  • Forager entered a six-month non-disclosure agreement (NDA) expecting serious engagement but received no material information.
  • Forager placed more than a dozen phone calls in June and July; none were returned.
  • Forager contacted Truist (financial adviser) multiple times to ask at what price the board would consider a transaction; no response was received.
  • Three acquisition proposals and private letters (May 23, May 30, Aug 1) received no substantive response or counteroffer.
  • Diligence questions submitted on June 18 were ignored.
• Legal Action: Quipt sued Forager on August 7 regarding the expired confidentiality agreement, which Forager argues demonstrates fear of exposure rather than a desire to sell.
• Forager’s Stance: Forager remains willing to increase its offer upon "constructive engagement" and calls on the board to negotiate to deliver shareholder value, arguing that a stand-alone strategy is unsustainable due to limited float, inability to grow organically, and high public company costs.

Notable Quotes

• "Quipt's convenient omissions and lawsuit demonstrate the board is motivated by self-serving tactics rather than shareholders' best interests."
• "Shareholders know what comes next -- the board will use the hiring of a financial adviser as cover to claim it has spoken to all logical buyers, and none met its definition of 'fair value.' It will frame recent growth initiatives as momentum to stall and build a case for its stand-alone existence or a hypothetical sale at a future date."
• "If our offer at $3.10 is so undervalued that it 'shouldn't be taken seriously,' how should shareholders reconcile that with the board's decision... to issue itself approximately 7 per cent of the company at $2.37 per share -- complete with automatic vesting upon a change of control."
• "Every day the board delays reduces the IRR for shareholders. That is, by definition, destruction of shareholder value."