In a groundbreaking move, Akumin, a leading national outpatient partner for US hospitals, health systems, and physician groups, has experienced an unprecedented surge in stock value, soaring over 142% in the wake of its agreement with Stonepeak to transition into a private company.
At the time of this publication, Akumin Inc stock (AKU) has witnessed a surge.
Current Price: $0.35
Change : +0.21
Change (%): (142.25%)
Source: Tomorrow Events Market Data
This pivotal development, announced on Friday, October 20, signifies a significant turning point for Akumin. The agreement with Stonepeak and its stakeholders entails a comprehensive financial restructuring that is poised to bolster Akumin’s financial standing, enhancing its balance sheet and furnishing substantial liquidity to pave the way for future triumphs. The consequence of this arrangement will be the delisting of Akumin from public stock exchanges.
To expedite this transformative transaction, Akumin, alongside select subsidiaries, is set to initiate prepackaged chapter 11 cases in the Southern District of Texas. Within an estimated 45-day timeline, Akumin anticipates court approval of the transaction, subject to certain regulatory green lights. Throughout this process, Akumin’s operations are projected to continue without disruption, assuring trade creditors, employees, and partners that business will proceed as usual.
Under the terms of the restructuring, the existing Stonepeak Note, amounting to approximately $470 million, will be nullified and transmuted into Common Shares of the Company. Furthermore, Stonepeak is poised to infuse an additional $130 million as a capital contribution.
To streamline this venture, Akumin and Stonepeak have formalized a Restructuring Support Agreement, backed by more than one-third of the Company’s common equity, a resounding majority of bondholders, and all revolving lenders. This agreement stipulates that, apart from those notes that will be exchanged for cash via the reverse Dutch election opportunity, the Company’s senior secured notes due 2025 will be swapped for new senior secured notes maturing on August 1, 2027, with an augmented interest rate, among other altered terms. Correspondingly, the Company’s senior secured notes due 2028 will be exchanged for fresh senior secured notes with identical maturity dates, but a heightened interest rate, alongside other revised terms.
In light of this transaction, existing common stockholders of Akumin will receive a combined sum of $25 million in cash, alongside contingent value rights (“CVRs”) tied to their shares.
This monumental transition will unfold under the auspices of a court-supervised process, with Akumin and select subsidiaries initiating prepackaged chapter 11 cases in the Southern District of Texas. In the event Stonepeak extends debtor-in-possession (DIP) financing or any other fresh capital injections before the transaction’s closure, these funds will convert to equity and subsequently offset the $130 million investment, on a dollar-for-dollar basis. Stonepeak will also earmark $60 million from its investment to facilitate a reverse Dutch election opportunity for the Company’s notes due in 2025 and 2028.
The unprecedented surge in stock value of Akumin following the transformative Stonepeak agreement marks a significant milestone in the company’s trajectory towards enhanced financial stability and future success.