"K-V Pharmaceutical Company Files Voluntary Petitions for Reorganization to Restructure Financial Obligations" ($KV)
Announced last night!:
K-V Pharmaceutical Company (NYSE: KVa/ KVb) ("K-V" or "the Company") and certain of its domestic subsidiaries today filed voluntary Chapter 11 petitions under the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York, seeking the protection of Chapter 11 while it seeks to restructure its financial obligations.I wrote yesterday that "I'm really wondering whether they file a Q this year. With the sub notes now trading ~7, it seems much more likely that they file for bankruptcy." I just didn't think it would happen that day!
These obligations include a milestone payment under the terms of the Company's agreement with Hologic Inc. pursuant to which the Company purchased all rights to Makena®. The Company was unsuccessful prior to the filing in obtaining a renegotiation of the milestone payments owed to Hologic on terms that were acceptable to the Company. As a result, the Company was forced to file these Chapter 11 cases. The Company has enough cash on hand to operate its business in the near term and intends to seek new financing and use of cash collateral to provide additional time to enable the Company to continue operations, as it takes additional steps to restructure its financial obligations.