Akumin reaches deal with Stonepeak to go private

Akumin announced that it has reached an agreement with Stonepeak, an alternative investment firm, and the company’s stakeholders on the terms of a financial restructuring. The contemplated transaction will result in Akumin no longer being publicly listed. To effect the transaction, the company and certain of its subsidiaries will commence prepackaged chapter 11 cases in the Southern District of Texas. The company expects to obtain court approval of the transaction within the next 45 days and complete the transaction after receiving certain regulatory approvals. Throughout the process, Akumin’s operations are expected to continue as normal. The company expects to continue to pay trade creditors, employees, and other partners in the ordinary course of business. The contemplated transaction will result in the existing Stonepeak Note, totaling approximately $470M, being cancelled and converted into common shares of the company. In addition, Stonepeak will invest $130M in new money into the company as a capital contribution. To facilitate the transaction, the company and Stonepeak have executed a restructuring support agreement with over one-third of the company’s common equity, a supermajority of the company’s bondholders, and all of the company’s revolving lenders. The restructuring support agreement provides that, other than those notes which are exchanged for cash via the reverse Dutch election opportunity described below, the company’s senior secured notes due 2025 will be exchanged for new senior secured notes with a maturity of August 1, 2027 and an increased interest rate, among other changes in terms. Additionally, the company’s senior secured notes due 2028 will be exchanged for new senior secured notes with the same maturity date but an increased interest rate, among other changes in terms. As part of the transaction, Akumin’s existing common stockholders will receive a total of $25M in cash as well as certain contingent value rights, or CVRs, for their shares. The transaction will be implemented through a court-supervised process and as such, the company and certain of its subsidiaries will commence prepackaged chapter 11 cases in the Southern District of Texas. In the event Stonepeak provides debtor-in-possession, or DIP, financing or any other new money contributions at or prior to the closing of the transaction, such DIP facilities and new money will convert to equity at closing and reduce the $130M investment amount on a dollar-for-dollar basis. Stonepeak will also make $60M of the proceeds from its investment available for a reverse Dutch election opportunity for the company’s notes due 2025 and the notes due 2028.