California Cryobank Stem Cell Services LLC entered into an agreement acquire all assets from Cord Blood America, Inc. for $15.5 million.
February 06, 2018
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California Cryobank Stem Cell Services LLC entered into an agreement acquire all assets from Cord Blood America, Inc. (OTCPK:CBAI) for $15.5 million on February 6, 2018. Under the terms of the agreement, California Cryobank will pay an upfront cash amount of $12.5 million, and $3 million will be paid as escrow. In connection with the sale, California Cryobank and Cord Blood America (‘CBAI’) will enter into a transitional services agreement. In case of termination, CBAI will pay a termination fee of $1.6 million to California Cryobank, and California Cryobank will pay a fee of $0.8 million to CBAI.
The completion of the transaction is contingent upon approval by Cord Blood America shareholders, receipt of certain third-party consents; FamilyCord's obtaining external financing and customary closing conditions. Red Oak Partners, LLC and its affiliated funds together representing approximately 30% ownership of Cord Blood have agreed to vote in favor of the transaction. The Board of Directors of CBAI have approved the transaction. On May 15, 2018, shareholders of Cord Blood America approved the transaction. The transaction is expected to close during the second quarter of 2018. Upon completion of the transaction, Cord Blood America presently estimates it will distribute a portion of the sale proceeds to its shareholders. CREO Montminy & Co., LLC provided fairness opinion to Cord Blood Board of Directors in connection with the transaction. Kenneth A. Schlesinger of Olshan Frome Wolosky LLP acted as legal advisor for CBAI, and Jay de Groot of Morrison & Foerster LLP acted as legal advisor for California Cryobank.
CBA Florida, Inc., formerly Cord Blood America, Inc., through its CorCell program and its subsidiary CorCell Companies, Inc., provides cord blood and cord tissue stem cell services. The Company's subsidiaries include Cord Partners, Inc., CorCell Companies, Inc., CorCell, Ltd., (Cord Partners, Inc., CorCell Companies, Inc. and CorCell, Ltd. are referred to collectively as Cord), CBA Properties, Inc. (Properties), and Career Channel, Inc. The Company and its subsidiaries provides private cord blood and cord tissue stem cell storage services to families throughout the United States and Puerto Rico, and Properties was formed to hold corporate trademarks and other intellectual property. Cord's operations provide umbilical cord blood banking and cord tissue services to expectant parents. Cord provides various services, which includes collection materials, physician and customer support, transportation, testing and cord blood storage.