Endo proposes sale process with first-lien debtholders as stalking horse

Chicago, Nov. 23 – Endo International plc has proposed a sale process that will be the subject of a hearing on Dec. 15, according to a notice filed with the U.S. Bankruptcy Court for the Southern District of New York.

The company has set up its first-lien debtholders as a stalking horse bidder, who would be represented through a separate entity.

The stalking horse bidder has agreed to credit bid the full amount of the $5.9 billion of prepetition first-lien debt; offer employment to all of the debtors’ employees on their current terms; assume and cure a significant number of trade contracts; establish voluntary trusts funded with up to $550 million over time, which will be disbursed to eligible opioid claimants who elect to participate in such trusts; provide at least $122 million in cash to wind down the debtors’ operations following the sale; and fund pre-closing professional fees.

Further, there is a four-month formal marketing period where Endo will allow them to attract a higher or otherwise better bid.

The debtors suggest this path after extensive consideration and careful study, as an alternative to a plan of reorganization.

Competing bids should be for substantially all of Endo’s assets or one or more of the following: one or more of the debtors’ business segments (including or excluding the collagenase clostridium histolyticum assets and/or the legacy opioid assets); all of the collagenase clostridium histolyticum assets; and/or all of the legacy opioid assets.

In order to facilitate the stalking horse agreement and any other successful bid, the debtors are also seeking authorization to undertake certain preliminary structuring steps that will streamline an ultimate sale in a tax efficient manner, thereby helping to maximize value received from the sale.

Notably, there is no break-up fee. There are however expense reimbursements for the stalking horse bidder.

The indication of interest deadline is Feb. 21.

Qualified bids are due by April 18. An auction will be held on April 27.

The suggested sale hearing date would be May 3.

Endo is a Dublin, Ireland-based specialty pharmaceutical company. The Chapter 11 case number is 22-22549.

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