Surgalign (Nasdaq:SRGA) announced today that it received a delisting notice from the Nasdaq market after filing for Chapter 11 bankruptcy.
Earlier this week, the company entered into an agreement to sell assets under a Chapter 11 bankruptcy. The asset purchase agreement enables Surgalign to sell substantially all U.S. hardware and biomaterial assets. It has a stalking horse bidder in place for those hardware and biomaterial assets.
Deerfield, Illinois-based Surgalign plans to conduct its business in an uninterrupted manner and fund the Chapter 11 proceedings.
According to a news release, Nasdaq determined that, due to the company’s voluntary Chapter 11 filing, its securities will be delisted. The company said it has no intentions to appeal the determination.
Surgalign said the Nasdaq intends to suspend trading at the opening of business on July 3, 2023. Once the delisting takes effect, it expects to begin trading on the OTC under the SRGAQ ticker.
More the current situation at Surgalign
Surgalign late last year announced a board-approved corporate restructuring plan that included an undisclosed amount of layoffs.
The company projected savings of about $30–35 million compared to 2022 as a result of the restructuring. Its board also gave management the go-ahead to explore other cost-saving avenues. The company listed those options as including paring down, selling or exiting certain aspects of its business.
In March, Surgalign sold its Coflex and Cofix product lines to Xtant Medical for $17 million. Around that time, Surgalign said it believed it had the cash on hand to fund itself into the fourth quarter of 2023.
In April, Surgalign received notification that it no longer remains in compliance with the $10 million minimum stockholders’ equity requirement for continued listing on the Nasdaq market. This falls under Nasdaq Listing Rule 5450(b)(1)(A). The letter further indicated that Surgalign failed to meet alternative standards for continued listing.
