Hanger Inc. has approved a plan to sell its Dosteon Solutions and CARES (Critical and Rehabilitative Equipment Solutions) businesses, according to an 8-K Form filed by the company. Both businesses are part of Hanger’s patient care business segment and will be reflected as discontinued operations in Hanger’s consolidated financial statements beginning in the fourth quarter of 2014.
According to the filing, Hanger has entered into a definitive agreement to sell the California branch of Dosteon. The sale is expected to close in the fourth quarter of 2014. Hanger is negotiating a potential sale for the additional portions of Dosteon and is seeking indications of interest for CARES.
Hanger reported it estimates the incursion of pre-tax exit and disposal costs of approximately $15.6 million to $30.4 million, including employee separation and retention costs of approximately $2.1 million to $2.4 million; contract termination and other exit costs of approximately $4.4 million to $12.8 million; and non-cash charges associated with the write-down of intangibles, fixed assets and inventory of approximately $9.2 million to $15.2 million. Approximate future cash impact is expected to range from $0.3 million of cash flows to $12.3 million of cash expenditures. According to the filing, “actual costs relating to these actions will not be known until the company has fully implemented the exit and disposal plan.”
According to the Hanger website, Dosteon Solutions “supplies physicians, hospitals, and surgery centers with post-surgical services and products for their patients, including but not limited to, off-the-shelf bracing and supplies, custom orthoses and rentals of durable medical equipment (DME) such as continuous passive motion devices and cold therapy.” CARES is “a secure, automated outsourcing system for hospitals to dispense orthopedic soft goods and durable medical equipment (DME) products.”