PLC shareholders to vote on merger in Sept.
Saying it has been unable to raise capital to continue operations, cardiac and vascular medical device company PLC Systems Inc. of Milford has proposed merging with a California company and selling its RenalGuard operations to a debtholder, according to a statement and a filing with the U.S. Securities and Exchange Commission (SEC).
Shareholders will vote on these measures at an annual, special meeting of shareholders at the Doubletree Hotel in Milford on Sept. 18, the company said last week.
Spin-off of lead product operations proposed
Members of the PLC board of directors have already approved proposals that would result in a merger with Viveve Inc., a private medical device company in Sunnyvale, Calif., that focuses on women’s health. Meanwhile, operations for Renal Guard, PLC’s lead product that prevents hospital-acquired kidney injury in high-risk patients, would be spun off into a private company and sold to GCP IV LLC, the company’s principal debtholder, according to a statement. RenalGuard is still undergoing clinical trials in the U.S. but has received regulatory approval in Europe.
It’s unclear what these proposals, if approved, would mean for PLC Systems’ Milford presence. A company spokesman could not be reached for comment.
After 2013 rebound, sales dropped of in Q1
PLC Systems had cut its losses last year, generating more revenue in the first three quarters of 2013 than in all of 2012 thanks to increased RenalGuard sales. But sales declined sharply by the first quarter of 2014, totaling $54,000, compared with $348,000 a year earlier.
In the second quarter, which ended June 30, PLC reported $73,000 in revenue, compared with $372,000 in the second quarter of 2013.
In a first-quarter earnings statement released May 15, PLC Systems CEO Mark Tauscher said declining revenue prompted the proposals.
“Since our initial work in launching RenalGuard some six years ago, we have built a nascent and promising business for RenalGuard in markets around the world, largely through partners. “Unfortunately, we have been unable to raise money to continue operations because of our current capital structure,” Tauscher said.
“The objective (of the proposals) is to avoid bankruptcy or other alternatives that would destroy any value for shareholders, and instead provide them with the opportunity to participate in the potential growth of a public company in the medical device arena that is better capitalized,” Tauscher said.
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