The Catapult Group International Ltd (ASX: CAT) share price is down more than 2% after announcing its Perch acquisition.
Catapult’s products are designed to optimise every athlete’s and team’s performance, avoid injury and improve return to play. The sports technology business works with more than 4,600 teams in more than 40 sports across more than 100 countries.
Perch acquisition
Catapult has acquired Perch (Catalyft Labs), a next-generation leader in athlete monitoring in the gym for elite teams. This deal is to help Catapult’s performance and health vertical. The idea is to integrate performance data across on-field and off-field environments, unlocking new growth opportunities.
It combines advanced computer vision and AI to deliver real-time, automatic tracking of athlete strength training.
It uses a compact 3D camera that mounts to any weight rack in minutes, detecting movements, recording performance and providing instant feedback.
The Perch platform allows trainers to build customised programs, assess readiness and track progress over time, while saving teams hours of manual data collection.
The acquisition price was US$15 million, with US$3 million paid in cash upfront. The rest will be paid by issuing new Catapult shares. Perch shareholders will also be eligible for an earn-out of up to US$10 million as long as the business achieves key annual contract value (ACV) growth milestones.
The business currently has US$2.5 million of ACV – Catapult said Perch has demonstrated “clear product-market fit in the professional sports market.”
Management comments
Catapult’s CEO & Managing Director, Will Lopes said:
From our earliest conversations with Perch, it was clear we share a vision to empower the world’s best athletes and teams through cutting-edge technology. By bringing our solutions together, we’re building a smarter, more connected athlete monitoring system – on the field, in the gym, and beyond. The acquisition strengthens our Performance & Health vertical and accelerates our mission to deliver intuitive, end-to-end solutions for professional sports. Importantly, the deal is accretive to our Rule of 40 profile and reflects our disciplined approach to evaluating growth opportunities.
Final thoughts on the Catapult share price
The stronger position that Catapult can put itself in, the better it will be for the company’s long-term success. Acquiring Perch seems to add capabilities to the company. I’m not sure if the current valuation is attractive, but the sports technology business is making impressive progress with its global client base.
