ASHEVILLE – Avadim Health, Inc., an Asheville-based health and wellness company that sells topical products made using a proprietary Bionome Engineered Platform, has reached an agreement with the company’s existing lender, Hayfin Capital Management, to sell most of its assets ahead of filing for Chapter 11 bankruptcy.
According to a statement, these moves “represent part of a plan to significantly strengthen the Company and best position it for a long and prosperous future.”
The agreement is called a “stalking horse sale agreement,” which is a binding sale agreement that a firm planning to file for bankruptcy signs prior to its assets being listed for auction. A company may select to form a stalking horse sale agreement with the intention of maximizing the value of its assets or to avoid a court-ordered auction following a bankruptcy filing.
The term is a relic from hunting, where either a real horse or an image of a horse allows a hunter to conceal an approach to a possible target. Bankruptcy proceedings, however, have very little concealed.
Hayfin Capital Management has also committed to provide “certain debtor-in-possession financing,” that would be subject to court approval, that will allow Avadim to meet its obligations during the process of the sale of its assets.
Avadim announced that it has retained the investment bank SSG Capital Advisors to initiate a comprehensive marketing effort to position its assets to other potential buyers in order to maximize potential return by yielding the highest and best price.
“Our goal is to pursue a transaction that maximizes the value of the Company and ensures we have the necessary resources and flexibility to invest in, and grow the business,” said Keith Daniels, Chief Restructuring Officer for Avadim in a statement. The company will continue to operate, and Daniels stated that the actions the company is taking will have “no impact on our day-to-day business or our ability to continue serving our customers.”
The filing was made in the U.S. Bankruptcy Court for the District of Delaware. The company was founded in 2007 in Asheville and has been based in Asheville since. The company manufactures the Theraworx, Phuel, and Combat One brands.
