Medical technology company Exactech has signed a comprehensive restructuring support agreement and asset purchase deal with a consortium of its current investors.
The latest development is part of company’s plans to initiate a voluntary, court-supervised restructuring to begin the sale process.
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Undisclosed private equity and alternative asset management entities overseeing over $25bn in assets are leading the investor group.
According to the deal, this group will act as the “stalking horse” bidder to acquire most of the company’s assets.
The investor group will also facilitate Exactech through the restructuring phase, providing around $85m in additional financing to support its operations.
During the restructuring process, Exactech will continue its regular operations to deliver medical devices and technologies to orthopaedic surgeons and patients.
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By GlobalDataThe restructuring is said to be aimed at freeing the company from non-operating legacy liabilities and injecting new capital.
Exactech president and CEO Darin Johnson said: “Our team has delivered strong performance and positive growth in 2024, and we are confident in the trajectory of our business.
“However, despite the strength of the underlying business, we face unsustainable liabilities associated with knee and hip litigation related to the packaging recalls we voluntarily initiated between 2021 and 2022.
“The process we are starting today is intended to help us create a stronger foundation for long-term growth with an improved balance sheet and new capital as well as ensure that we can continue providing innovative, industry-leading implants for surgeons and their patients for years to come.”
The sale is taking place as part of a voluntary reorganisation process before the US Bankruptcy Court for the District of Delaware and is contingent on receiving higher and better bids, court approval, and other standard closing conditions.
Exactech has filed several “first-day” motions to obtain court approval to maintain standard operations during the sale, including paying employee wages and benefits and compensating sales representatives.
Furthermore, the company will carry out its research and development activities throughout this period, to advance the development of its product offerings.
In August, Exactech signed an agreement with Alkem MedTech, a subsidiary of Alkem Laboratories, for the manufacturing and marketing of joint replacement implants in India.
