Speech recognition and data analytics vendor M*Modal, Franklin, TN, has filed for bankruptcy protection under Chapter 11 in the U.S. Bankruptcy Court in New York, reports the Wall Street Journal.
A decline in sales and failure to make a February interest payment to bondholders preceded the filing, according to the report. The court quickly approved M*Modal’s first-day motions, enabling it to pay employees and use remaining assets to continue operations.
"We intend to use the court process to significantly strengthen M*Modal's balance sheet and improve the company's financial flexibility by reducing our debt burden and establishing a capital structure that supports our investment in the future," said Duncan James, the company's chief executive officer, in a statement.
M*Modal, also the largest U.S.-based medical transcription company, listed liabilities of $852 million and assets of $626 million, and expects to conduct business as usual throughout the restructuring process.
M*Modal employed 9,900 workers in six countries and did business with more than 3,800 hospitals, clinics and physician practices at the time of filing, according to the report.
J.P. Morgan Chase’s private equity arm, One Equity Partners, took M*Modal private a year and a half ago in a $1.1 billion leveraged buyout.