Cylex, Inc.

Client Profile
Cylex is a global life sciences company based in Columbia, MD. Cylex develops, manufacturers and commercializes in vitro diagnostic products intended to illuminate immunity in the area of transplant medicine.
Situation
Cylex was subject to a government investigation triggered by a False Claims Act qui tam action. The uncertainty over the investigation constrained Cylex’s ability to attract further investment and the legal expenses for defending the action created a financial burden that starved the company of cash to fund operations and grow the business. As a result, Cylex pursued a strategy utilizing the Chapter 11 bankruptcy Section 363 sales process to allow a buyer to purchase the assets free and clear of the False Claims Act claims. After executing an asset purchase agreement with the stalking horse bidder, the Chapter 11 case was filed in the U.S. Bankruptcy Court for the District of Delaware in December 2012.
Solution
SSG was retained as Cylex’s investment banker to facilitate a sale of substantially all of the assets. SSG negotiated an asset purchase agreement with Oxford Immunotec of the United Kingdom, the stalking horse bidder, and conducted an accelerated remarketing process to identify additional bidders. Two additional qualified bids were received and after 16 rounds of bidding, spanning more than 12 hours, the all cash bid without conditions or escrow holdback from Viracor-IBT was determined to be the highest and best price for Cylex’s assets. SSG’s experience in running efficient and timely Chapter 11 sales processes and its knowledge of the market enabled stakeholders to increase sale proceeds by more than $8 million over the stalking horse bid and for 2.6 times revenue, a multiple typically reserved for healthy companies in the industry.