LifeScan announced that it entered into a restructuring support agreement and, to implement it, filed for chapter 11 bankruptcy.
The company filed voluntary petitions for prearranged chapter 11 cases in the United States Bankruptcy Court for the Southern District of Texas. It made this move to implement its restructuring agreement with its first- and second-lien lenders and current equity sponsor as efficiently as possible.
Malvern, Pennsylvania-based LifeScan expects to emerge from the process under the majority ownership of a group of existing lenders. It plans for the restructuring to “transform its balance sheet” while positioning it for a stronger, more profitable future. The company expects to reduce more than 75% of its debt to accelerate strategic investments that support its future.
As the process moves forward, LifeScan plans to operate in the ordinary course of business. It expects to emerge from chapter 11 by the end of the year.
LifeScan develops the OneTouch Bluetooth-connected blood glucose meter and mobile diabetes app that provide simplicity, accuracy and trust in diabetes management.
“This balance sheet restructuring will significantly strengthen LifeScan’s financial position, enabling us to continue serving more than 20 million customers across 50+ countries and put new growth strategies in place,” said Valerie Asbury, CEO of LifeScan. “We recognize that our products are essential for people with diabetes to make life-sustaining decisions and are evolving our model to bring products and services to market through multiple channels. I am deeply grateful for the partnership of our lenders and sponsor and the unyielding commitment of our employees, which will enable us to become a stronger company and create a world without limits for people with diabetes.”
