Case Study

Nuo Therapeutics

CLIENT: Nuo Therapeutics

As Nuo Therapeutics’ investment banker, Gordian was instrumental in staving off  both a secured creditor takeover and a liquidation, enabling a recapitalization to the benefit of shareholders and board of directors.

Business Profiles


Nuo Therapeutics (“Nuo”), a public company at the time, develops and markets regenerative therapies primarily in the United States. Nuo’s cell-based technologies harness the regenerative capacity of the human body to trigger natural healing for complex, chronic wounds.  The Company’s commercial offerings center on point of care platforms that allow for the safe and efficient separation of blood and bone marrow to produce platelet based therapies or cell concentrates, primarily through the Aurix System in conjunction with Restorix.

As an  early-stage venture company, Nuo had been losing money for years but recently received a tripling in its wound care treatment reimbursement rate.



Gordian was engaged in December 2015 as the Company’s investment banker to assist in exploring and implementing its capital markets alternatives, including a potential balance sheet restructuring and third party financing. At that time, Nuo was out of cash and at loggerheads with its secured creditor (“Secured Creditor”) who claimed it was owed approximately $35 million.

In mid-January 2016, with Nuo out of cash, the Secured Creditor provided DIP financing in connection with a bankruptcy filing tied to the Secured Creditor stalking horse bid of $13.4 mm (which meant the Secured Creditor would acquire Nuo absent a third party topping them, highly unlikely given the very aggressive timing the Secured Creditor required to consummate the sale).  The Secured Creditor bid reflected a compromise with Nuo over alleged infirmities in the amount of the Secured Creditor’s secured claim.

Ultimately, the Court found that there was insufficient time to run a proper market test and derailed the sale process.  Immediately thereupon the DIP was terminated by the Secured Creditor, and Nuo was on the verge of liquidation.


On April 25, 2016 – three months from the filing date, and just over two months after the sale process was derailed, Nuo confirmed a Plan of Reorganization which provided for:

  • a restructured and recapitalized Nuo;
  • the Secured Creditor receipt of (a) a royalty stream, the value of which reduced the Secured Creditor’s claim dollar for dollar and (b) new non-convertible preferred stock for the remaining face amount of the Secured Creditor’s claim;
  • Old Equity receipt of between 18 and 28% of the new equity (compared to the imminent wipe-out in either a liquidation or sale to the Secured Creditor);
  • the pre-bankruptcy Acting CEO (former CFO) became the CEO upon emergence; new equity funding in the aggregate of $10 mm; and
  • releases for the Board of Director.

In sum, Nuo was another home run for Gordian Group’s track record of creating value in difficult circumstances and wresting value from senior constituencies to the benefit of old equity, all the while protecting the Board of Directors.