The High Court is set to be asked by the end of next week to approve a survival plan for HealthBeacon, after creditors supported a deal that will see the Irish medical technology company being taken over by US-based Hamilton Breach Brands for €6.9 million.
The rescue plan – or so-called scheme of arrangement – drawn up by the company’s examiner, Shane McCarthy of KPMG, was approved by all five of HealthBeacon’s classes of creditors last week, HealthBeacon confirmed in a statement to the stock exchange on Monday. However, shareholders, who face wipeout, rejected the proposals, even if a majority in number but not value voted for the scheme, it said.
“It is anticipated that the hearing seeking sanction from the High Court of the scheme of arrangement will be heard by the end of next week, following which the company will make a further announcement,” the company said.
The blueprint only needed the approval of one category of “in the money” creditors – those that stood to recoup some of the money owed in the event of a liquidation – to get over the line. In the event, the examiner secured the support of three such categories of creditors.
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The Irish Times reported earlier this month on the outline of the rescue plan, which is on track to see Hamilton Beach, which had an existing partnership with HealthBeacon and funded the cash-strapped company through examinership, take over the business.
HealthBeacon’s flagship product is a smart sharps bin and an app for use by patients who inject medication at home.
The scheme will see unsecured creditors, owed €3.13 million, recoup 55 per cent of what they are owed.
HealthBeacon’s key supplier creditor, Wexford-based tech company Taoglas, whose technology is used in the digital sharps bins, secured retention of title on almost €2 million of stock under the rescue plan. It will also receive 55 cents on the euro for a further €604,828 of unsecured claims.
Hamilton Beach committed €1.85 million of funding to HealthBeacon to get it through the examinership process in a deal that positioned the US company as a secured creditor. Adding in interest and a €300,000 fee tied to the facility, it is owed €2.17 million, which is being made whole.
Preferential creditors, including Revenue, and certain claims from employees will also recover 100 per cent. They are owed a combined €342,547.
Investors pumped almost €50 million into the company since it was set up in 2013, including €25 million raised in a peak-of-the-market initial public offering in December 2021. Its market value had collapsed to just €1.18 million by the time share-trading was suspended in mid-October as investor confidence evaporated following a sales warning and ousting of co-founder Jim Joyce as chief executive.
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