Below is our initial take on recent bankruptcy-related developments:
Implant maker Exactech may conclude bankruptcy without TPG settlement | Reuters
Medical implant maker Exactech adjourned its Chapter 11 plan confirmation hearing on Wednesday, delaying proceedings that would have protected its owner TPG from lawsuits alleging defective implants.
S&K Take: There have been a lot of twists and turns in what has been a hard-fought case, and we now have another. TPG, the debtors’ equity sponsor, had agreed to a settlement to be implemented by the proposed plan that would provide $10 million to GUCs, with the debtors’ existing lenders making a credit bid to take the company. The debtors’ special committee investigated TPG-related claims and supported that settlement. The UCC, unsurprisingly, did not agree with that position, instead positing that the TPG claims were worth over $1 billion. The debtors were geared up for a multi-day donnybrook with the UCC over plan confirmation. The cases, however, took an abrupt turn on Tuesday. TPG noted that there was a lack of funding to continue down the proposed path, and the debtors told Judge Silverstein that they were considering a deal with the UCC that would permit confirmation to go forward without granting releases to TPG. While no deal has yet been cut, sounds like we got something in the works. The Judge agreed to adjourn confirmation (and a slew of related motions, mostly filed by the UCC, to appoint a trustee, obtain standing to prosecute claims against TPG, etc.) while the parties negotiate. No word yet on a prospective resolution, but this one will be worth watching.
Bankrupt 23andMe to be bought by pharmaceutical company Regeneron for $256 million | USA Today
The bankrupt genetic testing firm announced last Monday that it is set to be acquired by drug company Regeneron Pharmaceuticals.
S&K Take: This article is a little dated, about a week old. Needless to say, things have changed (or we wouldn’t be talking about it). The sale to Regeneron look(ed) like a great deal. The purchase price is a solid number, and Regeneron is saying all of the right things about customer privacy issues. Not so fast, my friend. When we reported on this case in its infancy, we talked about fallen former CEO Anne Wojcicki. She had attempted to purchase the company pre-bankruptcy but got the heisman from the special committee. Well, she’s back! Backup bidder TTAM (have to love acquisition vehicle names) and Wojcicki have objected to the sale to Regeneron, saying that TTAM was in the process of making an allegedly legitimate post-auction bid. The debtors are considering whether to consider that bid under a fiduciary out in the APA, while concurrently noting that TTAM is attempting to influence the special committee through litigation (is it working?). Regeneron says that this is all nonsense and that the bidding was closed. So we have a standoff. Regeneron’s position is usually a tough one to advance, since bankruptcy is all about value-maximization. They do have the insider card to play, so this one is harder than usual to handicap. Auction fun, regardless.
Popular home-décor retailer ‘At Home’ set to file for bankruptcy amid cash crunch, tariffs: report | New York Post
At Home, a home-décor retailer with 260 stores across 40 US states and territories, announced Wednesday that it is preparing to file for Chapter 11 bankruptcy.
S&K Take: At Home news has been kicking around recently, at least since early March when it was reported they were working with PJT to address softening demand and tariffs. The company has since reportedly added K&E and Alix to their professional roster. BofA resigned as agent on the company’s term loan, and a group of lenders/bondholders is reportedly working with Dechert and Evercore. We have all of the makings of a bankruptcy filing, which, while not a fait accompli (according to sources, even though that is exactly what it looks like), is allegedly set to hit the docket next month. Heller & Friedman is the sponsor. Looks like there are $200 million in secured notes at the sub level, with the ABL, Term Loan, and two other note series totaling about $1.75 billion at the Holdco level (although please note that analysis is unburdened by heavy research). We will keep an eye on this story, likely coming to a bankruptcy court near you.
