New York, Dec 18 (IANS) Shares of Ebix Inc. plummeted 54.6 per cent towards a 17-year low in premarket trading on Monday, after the Georgia-based provider of on-demand software for the insurance, financial services, travel and healthcare industries said it filed for bankruptcy, MarketWatch reported.
The company said it will continue to operate “normally”, and that its affiliates outside of the US are not included in the bankruptcy. The company also announced a “stalking horse” agreement to sell its North American life and annuity assets for $400 million to Zinnia, which is a deal reached ahead of an auction.
Ebix has retained Jefferies LLC to help with the sale process. The stock was headed for the biggest one-day percentage loss since going public in 1987, and was on track to open at the lowest price seen since October 2006. It had plummeted 75.3 per cent year-to-date through Friday, while the S&P 500 had rallied 22.9 per cent, MarketWatch reported.
Ebix Inc. announced on Monday that it has reached a “stalking horse” agreement to sell its North American Life and Annuity Assets (NA L&A Assets) to Zinnia, an Eldridge business and leading life insurance and annuity technology and service company, as part of its efforts to strengthen its balance sheet and position the company for sustainable growth.
This agreement is part of the strategic decision by the company to seek a value-maximising transaction that will benefit all the stakeholders and put the company on the path towards sustainable growth and profitability.
The NA L&A Assets being sold, accounted for 14.5 per cent of Ebix’s worldwide GAAP revenues for the year-to-date nine-month period preceding September 30, 2023.
To provide the time needed to identify and execute on its plans to effectuate the NA L&A Assets sale and to deleverage its balance sheet in a timely and efficient manner with the support of its key creditors and customers, US-based Ebix Inc. and certain US affiliates (the ‘Company’ or ‘Ebix’) filed for protection under Chapter 11 of the US Bankruptcy Code. Ebix’s approximately 200 affiliates outside the United States are not included in the US-only Chapter 11 filing and will continue to operate normally.
Ebix’s international subsidiaries and their franchisees around the world are similarly not included in the Chapter 11 filing. All worldwide operations of the company will continue to operate in the ordinary course and without any interruption.
–IANS
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