Shares of Exela Technologies (NASDAQ:XELA) stock shot up over 15% after the business processing automation (BPA) company announced that it had sold its high-speed scanner manufacturing and maintenance business to Imaging Business Machines (IBML). XELA stock has since dropped down to just a little over 6% up.
The sale, which includes Exela’s Intelliscan products, was enacted as part of the company’s previously announced strategic initiatives to sell off its non-core assets. Last year, Intelliscan’s family of products raked in $20.5 million of revenue. The sale price was not immediately disclosed in the accompanying press release. Proceeds from the sale will be used toward “general corporate purposes, debt obligations and transactions expenses.”
“I am pleased to welcome the team from Exela and excited to add Exela’s high-volume scanner products to IBML’s market-leading portfolio of solutions,” said IBML CEO Martin Birch. “The additional expertise and offerings will provide our customers with a more diverse portfolio of best-in-class high volume intelligent scanning solutions, and the ability to bring greater innovation to their document intensive business processes.”
XELA Stock Rises Following Non-Core Sale
Through the sale, Exela’s customers will still be able to use Intelliscan’s products, while Intelliscan’s team will join IBML.
Yesterday, Excel announced an offer for its senior secured notes. Subsidiaries of the company were offered to have all of their outstanding 11.500% first-priority senior secured notes due in 2026 exchanged for new 11.500% first-priority senior secured notes due in 2026. The issuers, Exela Intermediate and Exela Finance, will remain the same, while the offer will expire on July 7.
Each $1,000 in principal amount of the old notes tendered before 5 p.m. on June 22 will be eligible to receive $800 in principal amount of the new notes. Holders who tender their notes after this time will be eligible to receive $750 in the principal amount of the new notes.
The new notes will carry a coupon rate of 11.500% with a maturation date of April 15, 2026. In addition, the new notes will carry the same guarantors as the old notes.
“If at least 66.67% of the Old Notes are tendered, the provisions containing the restrictive covenants and events of default for the Old Notes will be eliminated and the Collateral for the Old Notes will be released,” added Exela.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.