Invitae Corporation (NYSE: NVTA) stock plunged almost 80% on Monday amid reports of the medical test maker preparing for imminent bankruptcy.
According to The Wall Street Journal, Invitae Corporation is facing financial distress and is gearing up to file for bankruptcy in the coming weeks. Sources close to the situation have disclosed that the genetics specialist is dealing with a whopping $1.5 billion debt, and it’s seeking help from business consultancy FTI Consulting (NYSE: FCN) and law firm Kirkland & Ellis to figure out its next steps. These options might include filing for bankruptcy.
This comes as a surprise since Invitae, based in San Francisco, has been snapping up companies left and right lately. But now, it seems they’re reversing course, selling off assets and trimming expenses.
In its latest move, Invitae sold its reproductive health assets to Natera for a potential total of $52.5 million, with an initial payment of $10 million. The agreement also includes additional payments of up to $42.5 million based on milestones and legal credits.
The decision to sell off this segment comes as Invitae faced financial strains, aiming to slash operating expenses by $44 million, excluding any one-time severance payouts.
Invitae (NYSE: NVTA) Stock Performance
NVTA stock plummeted -77.12% to close at $0.09 on Monday. The traders had exchanged hands with 94,199,600 (94.19 million) shares compared to the average daily trading volume of 7.61 million.
Edward Cooke is a financial analyst, freelance writer, and editor. He has six years of experience in financial journalism. He has an in-depth understanding of equities markets, tracking major indices and providing real-time analysis on stock price movements, corporate earnings, and market sentiment.
