SynCardia Systems has entered into an asset purchase agreement with an affiliate of Versa Capital Management to acquire substantially all of the company’s assets and operations, bringing with it the ability to provide the capital necessary for SynCardia to realise its full potential as the world’s first and only FDA, Health Canada and CE mark approved provider of the Total Artificial Heart and drivers, including the Freedom portable driver allowing clinically stable patients to be discharged from the hospital and live at home and in their communities.
The partnership with Versa ensures a solid financial footing on which the SynCardia can execute its business plan and accelerate its growth trajectory. The company’s day-to-day operations providing top quality hospital service and patient care will continue without interruption during the acquisition, which will require a brief court process under Chapter 11.
Michael Garippa, chief executive officer of SynCardia, comments: “Our first priority has been and will always be the relationship with our hospitals and the care of their many patients, none of which will be adversely effected by this sale process. We have developed a transaction structure to free the organization from substantial liabilities and maximise the value of our business. This sale provides a strong foundation for future growth and development of our next generation driver system, the Freedom 2. We are acting to ensure that SynCardia will be in the best position to provide lifesaving treatments for end-stage heart failure and to adapt our business to meet the changing needs of the healthcare industry.”
To fund operations, Versa has agreed to provide the SynCardia with debtor-in-possession financing. This financing, along with existing cash on hand and collections from ongoing operations, will ensure that it has adequate liquidity to continue to provide products and services to over 120 SynCardia Certified Centres worldwide during the sale process.
Syncardia has filed a voluntary petition under Chapter 11 of the US Bankruptcy Code in the Delaware Bankruptcy Court (the “Court”). The Versa APA will require Court approval (subject to higher or better offers). The company has proposed that the sale process be completed in approximately 45 days.