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Cryo-Cell Announces Plans to Explore Strategic Alternatives and Spin-off Celle Corp. to Maximize Shareholder Value

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Cryo-Cell International, Inc. (CCEL) announces the spin-off of its subsidiary, Celle Corp., to maximize shareholder value. Celle Corp. will hold assets not related to cord blood banking, including the Patent and Technology License Agreement with Duke University. The spin-off is expected to occur in the 2nd or 3rd fiscal quarters.
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With Cryo-Cell International announcing the spin-off of its subsidiary, Celle Corp. and exploring strategic alternatives, we're seeing a strategic move that could potentially unlock value for shareholders. The spin-off will allow Cryo-Cell to concentrate on its core business of banking umbilical cord blood specimens, which is a consistent revenue source. Meanwhile, Celle Corp. will hold certain non-core assets, including a patent and technology license with Duke University.

From a financial perspective, spin-offs can often lead to an increase in shareholder value as they allow each entity to focus on its specific strategic goals and market dynamics. It can also provide investors with a clearer choice in terms of investment opportunities. However, the success of such a strategy depends on the execution and the market's reception of the new entity. Given the lack of assurance of a transaction and the early stage of this process, stakeholders should monitor upcoming SEC filings for further details that will shed light on the financial implications of the spin-off.

The biotechnology sector is characterized by high R&D costs and significant regulatory hurdles. Cryo-Cell's decision to spin off Celle Corp. and explore strategic alternatives is a maneuver to potentially streamline operations and enhance focus on its profitable segments. The market will be observing how this restructuring might improve operational efficiencies and whether it will stimulate Cryo-Cell's growth trajectory.

Moreover, the transfer of the Patent and Technology License Agreement with Duke University to Celle Corp. suggests a strategic positioning of assets that could attract specialized investment or partnerships. The market will likely assess the potential of these assets separately from the core business, which could lead to a revaluation of Cryo-Cell's stock. Investors should consider the potential for increased market specialization and the opportunities it may create for targeted investments in the biotech space.

The legal aspects of a spin-off are complex and involve careful structuring to ensure compliance with securities laws. The transfer of the Patent and Technology License Agreement to Celle Corp. is indicative of a strategic reallocation of intellectual property rights, which can have significant legal and financial implications. Stakeholders should be aware that the spin-off process will be subject to regulatory scrutiny and will require transparent disclosure to investors through SEC filings.

This move also raises questions about the future governance of Celle Corp. and how its relationship with Cryo-Cell will be legally defined. Investors should look for details in the SEC filings regarding the terms of the spin-off, the rights of shareholders post-spin-off and any potential risks associated with the separation of assets and liabilities.

OLDSMAR, Fla.--(BUSINESS WIRE)-- Cryo-Cell International, Inc. (NYSE American LLC: CCEL) (the “Company” or “Cryo-Cell”), the world’s first private cord blood bank to separate and store stem cells in 1992, today announced that its Board of Directors has authorized the spin-off of its newly formed subsidiary, Celle Corp., to the Cryo-Cell shareholders and to explore all strategic alternatives for Cryo-Cell (post spin-off) to maximize shareholder value, including, but not limited to, equity and/or debt financings and/or the possible sale or merger of the company. There is no assurance that such a transaction will take place.

Celle Corp. was created to hold certain assets of Cryo-Cell not directly associated with the recurring revenue stream from privately banked, umbilical cord blood specimens. The Patent and Technology License Agreement with Duke University has been transferred to Celle Corp. and other assets and liabilities are expected to be transferred in the near future. The spin-off is currently anticipated to be in the form of a stock dividend to the Cryo-Cell shareholders and to occur in Cryo-Cell’s 2nd or 3rd fiscal quarters. Further details, once finalized, will be shared in public filings with the Securities and Exchange Commission.

About Cryo-Cell International, Inc.

Founded in 1989, Cryo-Cell International, Inc. is the world’s first private cord blood bank. ‎More than 500,000 parents from 87 countries have entrusted Cryo-Cell International with ‎their baby’s cord blood and cord tissue stem cells. In addition to its private bank, Cryo-Cell ‎International has a public banking program in partnership with Duke University. Cryo-Cell’s ‎public bank has provided cord blood for more than 600 transplantations and operates cord ‎blood donation sites across the U.S in prominent hospitals such as Cedars–Sinai Hospital in ‎Los Angeles and Baptist Hospital in Miami. Cryo-Cell’s facility is FDA registered, cGMP-/cGTP-‎compliant and licensed in all states requiring licensure. Besides being AABB accredited as a ‎cord blood facility, Cryo-Cell was also the first U.S. (for private use only) cord blood bank to ‎receive FACT accreditation for adhering to the most stringent cord blood quality standards ‎set by any internationally recognized, independent accrediting organization. Cryo-Cell has ‎the exclusive rights ‎to PrepaCyte-CB, the industry’s most advanced cord blood processing ‎technology.‎

Cryo-Cell’s mission is to provide the premier cord blood and cord tissue cryopreservation services, to develop, manufacture and administer cellular therapies to significantly improve the lives of patients worldwide and to offer the highest quality and most cost effective biostorage solutions available. In February 2021, Cryo-Cell entered into a license agreement with Duke University ‎that the Company believes has allowed Cryo-Cell to begin its transformation into an autonomous, ‎‎vertically ‎integrated cellular therapy ‎company. ‎In March 2022, Cryo-Cell launched ExtraVault to offer its expertise in biostorage and distribution to biopharmaceutical companies and healthcare institutions. For more information, please visit (www.extravault.com).

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In some cases, you can identify forward-looking statements by terminology such as “will,” “may,” “should,” “could,” “would,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “forecasts,” “potential” or “continue” or the negative of these terms or other comparable terminology. Generally, the words “anticipate,” “believe,” “continue,” “expect,” “intend,” “estimate,” “project,” “plan” and similar expressions identify forward-looking statements. In particular, statements about our expectations, beliefs, plans, objectives, assumptions or future events or performance contain forward-looking statements.

We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. These forward-looking statements involve risks and uncertainties and reflect only our current views, expectations and assumptions with respect to future events and our future performance. If risks or uncertainties materialize or assumptions prove incorrect, actual results or events could differ materially from those expressed or implied by such forward-looking statements. Risks that could cause actual results to differ from those expressed or implied by the forward-looking statements we make include, among others, risks related to: the impact of the COVID-19 pandemic on our sales, operations and supply chain, the success of the Company’s global expansion initiatives and product diversification, including its addition of the ExtraVault services, the Company’s actual future ownership stake in future therapies emerging from its collaborative research partnerships, the success related to its IP portfolio, the Company’s future competitive position in stem cell innovation, future success of its core business and the competitive impact of public cord blood banking on the Company’s business, the success of the Company’s initiative to expand its core business units to include biopharmaceutical manufacturing and operating clinics, the uncertainty of profitability from its biopharmaceutical manufacturing and operating clinics, the Company’s ability to minimize future costs to the Company related to R&D initiatives and collaborations and the success of such initiatives and collaborations and the success and enforceability of the Company’s umbilical cord blood and cord tissue license agreements, together with the associated intellectual property and their ability to provide the Company with royalty fees, along with the Risk Factors set forth in the Company’s Form 10-K filed on February 28, 2024.

This list of risks and uncertainties, however, is only a summary of some of the most important factors and is not intended to be exhaustive. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. These risks and uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. These forward-looking statements are made only as of the date hereof. Except as otherwise required by applicable law, we do not undertake and expressly disclaim any obligation to update any such statements or to publicly announce the results of any revisions to any such statements to reflect future events or developments. All subsequent written and oral forward-looking statements attributable to us, or to persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements.

Irene Smith

813-749-2102

Ismith@cryo-cell.com

Source: Cryo-Cell International, Inc.

FAQ

What is the ticker symbol for Cryo-Cell International, Inc.?

The ticker symbol for Cryo-Cell International, Inc. is CCEL.

What is the purpose of the spin-off announced by Cryo-Cell International, Inc.?

The spin-off is aimed at maximizing shareholder value by transferring certain assets not related to cord blood banking to a newly formed subsidiary, Celle Corp.

Which assets of Cryo-Cell International, Inc. will be held by Celle Corp. post spin-off?

Celle Corp. will hold assets such as the Patent and Technology License Agreement with Duke University, not directly associated with the recurring revenue stream from cord blood specimens.

When is the spin-off of Celle Corp. expected to take place?

The spin-off of Celle Corp. is anticipated to occur in Cryo-Cell's 2nd or 3rd fiscal quarters.

What will happen to Cryo-Cell International, Inc. post spin-off?

Cryo-Cell International, Inc. will explore strategic alternatives to maximize shareholder value, including equity and/or debt financings and/or a possible sale or merger of the company.

Cryo-Cell International Inc.

NYSE:CCEL

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