#United States #Belgrade #Xtant Medical #Companion Spine #Coflex

Xtant Medical's Strategic Move in Spinal Care

In a significant development for the medical technology sector, Xtant Medical Holdings, Inc. (NYSE American: XTNT) has announced definitive agreements to sell specific assets related to its Coflex® and CoFix® interlaminar stabilization implants, alongside all of its OUS (Outside the United States) entities, to Companion Spine, LLC. This French-American company specializes in dynamic spine stabilization and motion preservation systems aimed at alleviating spine and back pain.

Transaction Overview

The deal, valued at approximately $19.2 million, comprises $11 million in cash at closing and $8.2 million in short-term seller financing. Xtant intends to leverage the proceeds from this transaction to significantly reduce its long-term debt and enhance cash liquidity, thereby enabling better operational focus on its core products.

Sean Browne, Xtant Medical's President and CEO, elaborated on the transaction by stating, "This step enables us to refocus on our primary business of developing high-margin, best-in-class orthobiologics while streamlining our operations and improving our financial framework." He expressed confidence in Companion Spine's capability, given their proven track record in the neuro-musculoskeletal sector.

Benefits for Companion Spine

On the other hand, Companion Spine anticipates that acquiring the Coflex and CoFix products will substantially enrich their portfolio. Anthony G. Viscogliosi, Principal at Viscogliosi Brothers and CEO of Companion Spine, indicated that this acquisition would enhance their offerings, thus better serving pain management professionals and spine surgeons worldwide. With effective solutions tailored for degenerative conditions such as disc disease and lumbar stenosis, Companion Spine aims to offer less invasive alternatives to traditional surgical procedures.

Financial Structure and Future Plans

As part of the agreements, a non-refundable cash deposit of $2.5 million has already been paid to Xtant, with terms that allow for up to two additional cash deposits of $2.5 million each if Companion Spine needs extra time to secure financing. Furthermore, assuming successful funding, Companion Spine will pay an additional $8.5 million before the deal closes, and another $8.2 million structured as an unsecured promissory note maturing on December 31, 2025.

What's Next for Xtant Medical?

Xtant Medical is poised to share additional insights regarding the transaction in their upcoming conference call scheduled for August, where they will discuss their financial performance and operational updates. The anticipated closure of the sale is set for the third quarter of 2025, upon satisfying customary closing conditions, including financing acquisition by Companion Spine.

Xtant Medical Holdings aims to honor the legacy of organ donation by innovating ways for patients to lead full, healthy lives. The company is dedicating itself to the development of a comprehensive portfolio of orthobiologics for wound care and spinal implant systems, catering to the healthcare needs of various markets worldwide.

Conclusion

As Xtant Medical takes this decisive step to divest certain assets, it marks a pivotal transition in its strategy. This move not only promises enhanced financial stability but also aligns the company more closely with its core focus on innovative healthcare solutions. The collaboration with Companion Spine holds promise for both organizations, with potential long-term benefits for patients and spine care professionals alike.