IRVING, Texas - Biote Corp. (NASDAQ: BTMD), a preventive health care company specializing in personalized hormone optimization, has reached a settlement with its founder, Dr. Gary S. Donovitz, concluding a period of litigation. The agreement, announced today, includes a share repurchase plan where Biote will buy back all 18.4 million shares held by Donovitz for approximately $76.9 million.
The repurchase is structured over a three-year period, with the first transaction of about 5.1 million Class A Shares and 3.1 million Paired Interests completed for roughly $32.2 million on April 26, 2024. Future repurchases will occur on the 12-month, 24-month, and 36-month anniversaries of the initial closing date, totaling an additional $44.7 million.
Terry Weber, CEO of Biote, expressed confidence in the company's financial position to execute the multi-year share repurchase and its potential positive impact on shareholder value. With the legal distractions resolved, the company intends to concentrate on its strategic goals and growth.
The settlement also includes a mutual release of claims, the termination of Donovitz’s advisory agreement, and a two-year non-compete and non-solicitation commitment from Donovitz.
Biote plans to disclose further details regarding the financial implications of the settlement in its first quarter financial results on May 7, 2024.
InvestingPro Insights
Biote Corp. (NASDAQ: BTMD) has recently settled litigation with its founder, paving the way for a share repurchase plan that could signal confidence to investors about the company's future. The InvestingPro data and tips provide further insight into the financial health and potential of Biote, which may be of interest to investors considering the implications of the recent settlement.
InvestingPro data highlights a market capitalization of $191.15 million, suggesting a moderate scale in the preventive healthcare industry. The company's revenue growth over the last twelve months as of Q4 2023 stands at a solid 12.37%, indicating a growing business. Moreover, the company boasts a substantial gross profit margin of 68.78%, which could point to efficient operations and a strong market position for its personalized hormone optimization services.
Among the InvestingPro Tips, two particularly stand out for Biote Corp. The company is expected to see net income growth this year, which could be a positive signal for investors looking for companies with improving profitability. Additionally, Biote operates with a moderate level of debt, which may provide it with financial flexibility and resilience, especially important for investors in the current economic climate.
For investors seeking more in-depth analysis and additional insights, there are further InvestingPro Tips available, detailing aspects such as valuation, earnings multiples, and liquidity. These can be found at: https://www.investing.com/pro/BTMD. And for those who wish to access the full suite of insights, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, which includes a total of 11 InvestingPro Tips for Biote Corp.
The upcoming financial results on May 7, 2024, will likely provide further clarity on the impact of the share repurchase plan and settlement. Meanwhile, investors can track Biote's performance and make informed decisions with the aid of real-time data and professional analysis.
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