Transaction Eliminates More Than $20 Million in Debt, and Other Financial Obligations, Provides $2 million in Cash and Significantly Enhances the Company's Balance Sheet and Liquidity
The Company will review with shareholders at 2:00 p.m. EST, details below.
GARDEN CITY, NY, Jan. 22, 2025 (GLOBE NEWSWIRE) -- ProPhase Labs, Inc. (NASDAQ:PRPH) ("ProPhase" or the "Company"), a next-generation biotech, genomics, and diagnostics company, today announced the closing of the sale of its wholly-owned subsidiaries, Pharmaloz Manufacturing Inc. and Pharmaloz Real Estate Holdings, Inc. (collectively "Pharmaloz" or "PMI"), to a private equity group based in Houston, Texas ("Buyer" or "Buyers"). The transaction carries an aggregate deal value of approximately $23.6 million and will immediately bolster ProPhase's balance sheet and liquidity by eliminating over $20 million in debt, payables, and other contingent liabilities.
As part of this transformative deal, the Buyers are providing approximately $2 million in cash payments while more than $10 million in debt will be retired. Additionally, the Buyers are assuming nearly $2 million in capital leases and close to $3 million in current and accrued payables, as well as canceling $300,000 in accrued interest tied to the debt being retired. The private equity firm will further assume approximately $3 million of upcoming capital expenditures.
The transaction includes the acquisition of Pharmaloz Real Estate Holdings, with the private equity group assuming the existing $3.3 million mortgage on PMI's manufacturing facility. Several ProPhase employees will transfer to Pharmaloz, thereby reducing the Company's overhead. Overall, the transaction better positions the Company to focus on its highly promising and high value core businesses.
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