Nanovation Up For Sale
A U.S. bankruptcy court yesterday passed an order that gives Nanovation Technologies Inc., a startup developing integrated optics components, about six weeks to find new investors, arrange for the sale of its assets, or come to a deal that incorporates both of these options.
The order sets a deadline of October 19 for a potential buyer or group of investors to be named. The deal must be closed by Nov 17. If negotiations take longer, the buyers or investors will have to fork out some money to keep Nanovation going, because the $5 million put up by the company’s existing investors will have run out (see Nanovation Files for Chapter 11).
Salomon Smith Barney is helping Nanovation’s management and court officials find potential buyers and investors.
Sources close to the company say some potential purchasers have been sniffing around but haven’t been prepared to declare a formal interest until they knew the outcome of yesterday's hearing in the U.S. Bankruptcy Court for the Northern District of Illinois, Eastern Division.
In any event, Nanovation’s sale or recapitalization must be completed by January 15 of next year if the company is to avoid being wound up by the Court.
It seems most likely that Nanovation’s assets will be bought, although they may not fetch much cash, if the purchase of a similar startup, Kymata Ltd., by Alcatel Optronics (Nasdaq: ALAO; Paris: CGO.PA) is anything to go by.
That deal was for a measley $119 million, and Kymata is considerably larger than Nanovation (see Kymata Sold for $119 Million). Kymata has approximately 400 staff while Nanovation now has a mere 63, following a big layoff last month (see Nanovation in Crisis).
— Peter Heywood, Founding Editor, Light Reading