Alphatec Spine Announces Intent to Restructure Scient’x Business Operations (press release)
Alphatec Holdings, Inc. (Nasdaq:ATEC), the parent company of Alphatec Spine, Inc., a medical device company that provides physician—inspired solutions for patients with spinal disorders, announced that its French affiliate, Scient’x S.A.S. and its subsidiary Surgiview S.A.S. (collectively, “Scient’x”) has begun a process aimed at significantly restructuring its business operations. This restructuring plan, when completed in accordance with French laws, is expected to reduce Scient’x’s workforce by 76 positions in total. It is anticipated that the restructuring will reduce operating expenditures between $2 to 6 million on an annualized basis and is part of the Company’s strategy of streamlining the organization and lowering cost structures, with an expectation to improve its profitability in 2014 and beyond.
Scient’x is working cooperatively with its Works Councils on this restructuring plan and the corresponding collective redundancy plan.
“The decision to begin the process of restructuring our operations in France was very difficult but ultimately was based on the management team undertaking a thorough analysis of the current and future market environment and Scient’x’s ability to remain competitive while meeting our customers’ needs with the best and most affordable solutions,” said Les Cross, Chairman and CEO of Alphatec Spine, Inc. “Upon completion, this restructuring should leverage Alphatec Spine’s current global investment in manufacturing, infrastructure, and sales distribution capacity, while still providing Scient’x’s customers, distributors, and suppliers with immediate and long-term benefits.”
This restructuring plan should result in multi-year reductions in operating expense, yielding improvements in international gross margins and increasing overall operating margins. The Company would incur one-time restructuring costs associated with the implementation of this plan consisting primarily of transition, severance and other costs related to work force reductions.
“We appreciate the significant contributions of those employees who could be impacted by this plan and their dedication to Scient’x and their customers. We will do everything possible to assist all affected employees and their families,” said Mr. Cross.
During their Q3 2013 earnings call, Alphatec Spine will provide additional details on the longer-term financial benefits related to the proposed changes as well as more information on one-time costs, including the timing of those expenses, which would impact the Company’s ongoing financial performance.
Further information regarding the Company’s recommendation to restructure Scient’x business operations in France is set forth in a Current Reports on Form 8-K that was filed with the U.S. Securities and Exchange Commission (SEC) and is available on both the SEC’s website at www.sec.gov and the Company’s website at www.alphatecspine.com.
About Alphatec Spine
Alphatec Spine, Inc., a wholly owned subsidiary of Alphatec Holdings, Inc., is a medical device company that designs, develops, manufactures and markets physician-inspired products and solutions for the treatment of spinal disorders associated with trauma, congenital deformities, disease and degeneration. The Company’s mission is to combine innovative surgical solutions with world-class customer service to improve outcomes and patient quality of life. The Company and its affiliates market products in the U.S. and in over 50 countries internationally via a direct sales force and independent distributors.
Additional information can be found at www.alphatecspine.com.