Health Diagnostic eyes sale or plan sponsorship with proposal

By Kali Hays

New York, June 29 – Health Diagnostic Laboratory, Inc. is looking to sell substantially all company assets or obtain a sponsor for a plan of reorganization, according to strategic transaction bid procedures filed Monday with the U.S. Bankruptcy Court for the Eastern District of Virginia.

The proposed procedures “entertain significant flexibility in bidding” and allow interested buyers to bid on all or any part of the company’s business or submit offers to contribute capital supporting a stand-alone plan of reorganization.

Though Health Diagnostic has been marketing its assets since before filing for bankruptcy, the company does not yet have a stalking horse bidder for the assets. However, if a stalking horse bidder is selected, it will be entitled to a break-up fee equal to 3% of the purchase price if it is not the ultimate buyer of the assets.

Under the proposed procedures, initial indications of interest are due by 5 p.m. ET on Aug. 20, and the bid deadline is 5 p.m. ET on Sept. 4.

If multiple bids are received by the deadline, an auction will be held on Sept. 10 and a sale hearing will follow on Sept. 16.

Health Diagnostic, a Richmond, Va.-based blood testing company, filed for bankruptcy on June 7. The Chapter 11 case number is 15-32919.

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