This $19M Acquisition Never Went to Market

TL;DR: This was a nearly $20M asset deal that required only about 18% cash at closing because it was a divestiture, not a competitive sale. The buyer won by spotting non core asset signals early, structuring for certainty instead of price, and using seller financing and deposits to minimize cash. The real edge is not paying more. It is identifying divestitures months in advance through industry data and building flexible deal structures that sellers accept because focus and speed matter more than optimization.

The Divestiture Advantage

How to Buy $20M Assets With <20% Cash - and See Them Coming 12 Months Early

Most buyers analyze closed deals.

Sophisticated buyers analyze why the deal existed at all - and how to identify the next one long before bankers, CIMs, or auctions appear.

This $19.2M divestiture by Xtant Medical is a clean, real-world case study in:

1. Low-cash acquisition structuring

2. Divestiture-driven deal sourcing

3. Using industry data exhaust instead of banker processes

Let's walk through both sides, the deal and the pipeline that produced it.

The Deal in One Sentence

In December 2025, Xtant Medical divested its Coflex® / CoFix® spinal implant assets and Paradigm Spine international business to Companion Spine for approximately $19.2M, using non-refundable deposits and short-term seller financing to reduce incremental cash at closing to ~18%.

Why this deal existed (this is the real alpha)

This was not a company-for-sale process.

It was a portfolio rationalization.

Xtant publicly communicated a shift toward core orthobiologics, rendering its hardware spine products non-core. That language is not cosmetic - it is the earliest divestiture signal.

Those signals appear months before any transaction in:

• earnings calls

• trade publications

• segment disclosures

• operational commentary

This is why divestitures are structurally different - and structurally advantageous - versus traditional acquisitions.

Deal anatomy: dollars, percentages, and structure

Total consideration: approximately $19.2M

Cash consideration - $11.0M (57.3%)

• $7.5M non-refundable deposits = 39.1% of total

• $3.5M cash at closing = 18.2% of total

Seller financing - $8.2M (42.7%)

• Unsecured promissory note

• Short maturity (January 2026)

• Principal reduced by post-close inventory and working-capital adjustments

Earnouts / CVRs / royalties

• None disclosed

Third-party financing

• Not publicly disclosed

Key takeaway: This was a nearly $20M transaction that required less than one-fifth of the purchase price in incremental closing cash.

That is not a pricing decision - it is a structural decision.

What worked and what could have been improved

What worked

• Non-refundable deposits created certainty early

• Short-dated seller financing bridged buyer liquidity

• Adjustment netting against the note reduced post-close friction

Where it could have been optimized further

• Secured or springing-secured seller note (IP, inventory, receivables)

• Holdback note replacing additional close cash

• Royalty or usage-based participation in lieu of cash

Each of these could have reduced cash at close below 15% without changing headline valuation, while reducing seller risk, not increasing it.

The real lesson: divestitures behave differently

Divestitures are not competitive auctions. They are organizational decisions.

Sellers prioritize certainty and focus, buyers can prioritize structure over price and creative terms are accepted because exit > optimization

Which brings us to the most important part.

How to Source Divestiture Deals Like This

(The Full Industry-By-Industry Intelligence Stack)

SEC filings confirm what happened. Industry data and trade publications tell you what's coming.

Below is the complete sourcing matrix, by sector.

Cross-Industry / General M&A & Divestiture Intelligence

High-signal platforms

• Axios Pro (paid)

• PitchBook News (news free; data paid)

• PE Hub (paid)

• Mergermarket (paid, banker-grade)

• The Deal (paid)

• Seeking Alpha (free + paid)

Signal language to watch: "strategic alternatives," "portfolio optimization," "non-core assets," "focus on core platforms"

Healthcare / MedTech / Spine

• Becker's Hospital Review (free)

• MedTech Dive (free)

• MassDevice (free)

• FierceMedTech (free)

• Orthopedic Design & Technology (free + premium)

Why this matters: Medtech divestitures often involve product lines, not companies, ideal for asset deals with flexible structures.

Industrials / Manufacturing

• IndustryWeek (free)

• Modern Machine Shop (free)

• Supply Chain Dive (free)

Signals: factory consolidation, SKU rationalization, footprint optimization, supplier exits.

Energy / Infrastructure

• Energy Intelligence (paid)

• Upstream Online (paid)

• Recharge (paid)

Signals: "capital discipline," "balance sheet optimization," "non-core asset monetization."

SaaS / Technology

• The Information (paid)

• TechCrunch (free)

• SaaStr (free)

Signals: product sunsetting, platform consolidation, deprioritized SKUs.

Financial Services / Insurance

• Insurance Journal (free)

• AM Best News (paid)

• Bank Director (free)

Signals: book transfers, geographic exits, agency divestitures.

How this becomes a machine (not reading homework)

This entire stack can be automated:

1. RSS + Google Alerts across the sources above

2. Articles routed into a GPT agent

3. GPT scores for:

   • divestiture likelihood

   • asset vs. company sale

   • repeat-seller probability

   • structural flexibility

The output is not "news." It is a ranked acquisition pipeline.

Final takeaway

This deal was not won by paying more. It was won by:

• Recognizing divestiture signals early

• Structuring around certainty instead of price

• And sourcing outside banker ecosystems

SEC filings tell you what closed. Industry data tells you what's coming. Structure determines who wins.

My question? If you could consistently identify divestitures 6-12 months early, would you rather compete on valuation or on terms?

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