Bioventus divests wound business to LifeNet Health (MassDevice)
This sale is another sign of the tight financial times.
Unprofitable orthopedic companies are being force to sell off assets for cash. Accelus sold its REMI robot system to ATEC for $55M and Bioventus just sold its wound care business to LifeNet Health for $85M.
Bioventus (Nasdaq:BVS) announced today that it signed a definitive agreement to sell its wound business to LifeNet Health. Durham, North Carolina-based Bioventus’ sale includes its skin substitutes, TheraSkin and TheraGenesis. The transaction includes a total cash consideration of $85 million. That features $35 million at close, $5 million deferred 18 months and $45 million in potential earn-out payments.
At the time of closing, Bioventus expects to net approximately $30 million after fees and expenses. It intends to use that cash to repay existing debt.
The two companies also signed a sales agent agreement. This grants LifeNet exclusive rights to sell SonicOne ultrasonic would debridement products in the U.S. and Canada.
Bioventus said its divestiture reduces its annual revenue by approximately $40 million and its adjusted EBITDA by about $5 million. It expects the transaction to close in approximately one week.
Jeffereies serves as financial advisor and Reed Smith acts as legal advisor in connection with the transaction.
“The sale of our wound business will enhance our liquidity and enable a greater focus on execution,” said Tony Bihl, Bioventus’ interim chief executive officer. Bihl took over last month after CEO Ken Reali stepped down.