Medtech Firm Surgalign Holdings Inc SRGA has entered into an asset purchase agreement to sell its U.S. hardware and biomaterials assets and the equity interests in non-Debtor entities related to the Debtors' hardware business outside of the U.S. to Xtant Medical Holdings Inc XTNT for $5 million.
The sale will be effectuated through the Chapter 11 proceedings initiated by the company, which elected to file voluntary petitions under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division.
As part of the Chapter 11 proceedings, the company also filed a motion seeking authorization to pursue an auction and sale process under which Xtant will be designated as the stalking horse bidder.
In a separate SEC filing, Surgalignauthorized a reduction in the workforce which will result in the termination of approximately 25 employees, effective June 16, and reduce expenses by approximately $3.5 million over the next 12 months.
In November, Surgalign approved a corporate restructuring plan.
In Q1 FY23, the company reported sales of $16.7 million compared to $20.6 million a year ago.
As of March 31, 2023, cash and cash equivalents were approximately $22.4 million.
The company reported an operating loss of $1.1 million compared to an operating loss of $8.9 million.
Reuters reported that Surgalign filed for bankruptcy with estimated assets and liabilities in the range of $50 million to $100 million in the Southern District of Texas Bankruptcy Court.
Price Action: SRGA shares are down 76.20% at $0.29 on the last check Tuesday.
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