MiMedx CEO Won't Put A Date On Sanara Closing After FTC Second Request
The deal was aimed at an October close, and the delay has started a ticking fee on a $300 million term loan commitment.
MiMedx, which makes placental and other tissue-based products for wound care and surgery, now has no closing date for its Sanara MedTech purchase after the FTC issued a second request. CEO Joseph Capper said on the company's third-quarter earnings call Wednesday that the company had been working toward an October close before that request.
A deal on hold, a fee running
Asked by an analyst at Lake Street for an update, Capper said the FTC interaction has been "very positive" and that he is optimistic the company can move through it efficiently. He said he could not comment on what the further inquiry covers, and added: "I certainly don't want to put a timeline on it because it's outside my control."
The second request also extends the Hart-Scott-Rodino waiting period, the antitrust clock for large deals. Capper said MiMedx remains fully committed to the acquisition.
CFO Doug Rice said the delay means MiMedx has begun to incur a modest ticking fee on Hafen Capital's commitment for a six-year, $300 million first-lien term loan, initially priced at term SOFR plus 6.25%. The fee comes due at closing, when the loan would be funded. Together with cash on hand, the proceeds are meant to pay the cash portion of the price.
The combined-company math
Management expects the combined company to reach run-rate revenue close to $400 million, about 75% from surgical and 25% from wound care. Capper said all of Sanara's more than $100 million in revenue comes from surgical procedures, and that its cleared products open up $4 billion in addressable markets where MiMedx does not now compete.
Rice said the target of an adjusted EBITDA margin of at least 20% in the first year, backed by $20 million or more of cost synergies, still stands. "It's just a question now of when that first year is able to begin," he said. Net leverage is expected to fall below three times by the end of the first full year after closing.
A quarter of surgical growth, wound decline
Third-quarter net sales were $62 million, down 45% from a year earlier. Surgical sales of $40 million rose 9%, while wound care sales of $22 million fell 71% after Medicare reimbursement changes took effect January 1, 2026.
Adjusted EBITDA was $2 million, a $10 million improvement from the second quarter. MiMedx ended the quarter with $121 million in net cash and no borrowings after repaying the last $17 million of a term loan. It now expects full-year net sales of $250 million to $260 million on a standalone basis.
Separately, MiMedx announced a $25 million settlement and license with a party it says infringed its patents. Capper said two other cases are still in litigation.
Capper said the Medicare fee schedules, typically published in November, are the only scheduled event for wound care, and he expects 2027 to look much like 2026.
Sources
- MiMedx Group Non-GAAP EPS of -$0.01, revenue of $62.2M misses by $6.52M (MDXG:NASDAQ) | Seeking Alpha — seekingalpha.com
- MiMedx: Q3 Earnings Snapshot — Associated Press
- MIMEDX Announces Third Quarter 2026 Operating & Financial — globenewswire.com
- MIMEDX Announces $25 Million Patent License Agreement — globenewswire.com
