💥New Chapter 11 Bankruptcy Filing - Cutera Inc.💥
Prepack equitizes prepetition noteholders and planned ERO will inject fresh capital.
On March 5, 2025, NorCal-based Cutera Inc. ($CUTR) (“CUTR”) and venue-manufacturing-shamco Crystal Sub LLC filed prepackaged chapter 11 bankruptcy cases in the Southern District of Texas (Judge Perez).* And they engaged FTI Consulting Inc. ($FCN) (“FTI”) (Gregory Milne). Mr. Milne filed these bad boys while the ink on our piece lamenting FTI’s dearth of deal flow was still wet! Fellas, just give us a heads-up next time! Anyway, CUTR is a “leading”** developer, manufacturer, and marketer of products for pizza-faced teens, women fed up with Brazilians, and Yakuzas turning over a new leaf. In case you squares aren’t catching our drift, that’s acne treatment, hair and tattoo removal, and “other aesthetic and dermatologic conditions.”
The capital structure ain’t complicated.
But those notes are something special. Y’all remember ‘21 and early ‘22? The federal funds rate was hovering at zero, and funds were desperate for yield. So much so that they’d throw (someone else’s hard-earned) cash at damn near anything that could scratch the itch. A 5+ year gamble for a juicy fixed 2.25% (the ‘26 and ‘28 notes) and 4.00% (the ‘29s) return?
One problem: this business kinda sucked even then. Like, in five of the prior six years, the company lost a combined $73.9mm, with only ‘17 showing a profit – $30mm, driven by the introduction of truSculpt 3D, a “fat reduction and body contouring” device. Sydney Sweeney can tell you how those devices are selling now.
