The American orthological company Bioventus will acquire an Israeli company for the treatment of cartilage CartiHealdespite its problems in financing the deal.
Last month, Bioventus announced that it had canceled the $ 415 million it had planned to raise to finance the acquisition due to market conditions and did not have enough money in its coffers to complete the deal, although it added that it was looking for alternative financing.
Elron Ventures (TASE: ELRN), which has a 25% stake in CartiHeal, announced today on the Tel Aviv Stock Exchange that the sale will continue by postponing most of Bioventus’ initial payment. Bioventus initially agreed to pay $ 350 million to the Israeli company immediately, plus up to $ 150 million in basic payments, after Cartiheal received FDA approval for its scar-free cartilage tissue product.
But now Bioventus will pay $ 100 million immediately, another $ 50 million in one year, and the rest gradually over the next 30 months. Bioventus has increased its credit lines to be able to make the initial payment. Delayed payments will be at 8% annual interest.
In addition, the basic payment threshold has been reduced from $ 100 million for Cartiheal products for one year to $ 75 million.
An additional new clause in the agreement allows CartiHeal shareholders to claim back their shares if Bioventus is late with its payments. In addition to Elron, CartiHeal’s shareholders include Accelmed, aMoon, Peregrine Ventures, Johnson & Johnson Innovation and Access Medical.
Posted by Globes, Israel Business News – en.globes.co.il – on June 20, 2022.
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