Indianapolis-based Adayana Inc. received permission this week from U.S. Bankruptcy Court in Indianapolis to sell the business to a secured lender in exchange for millions of dollars of debt.
Adayana, which filed for Chapter 11 protection in October, provides outsourced training services to the automotive, agribusiness and health-care industries, as well as the federal government.
The buyer, AVX Learning LLC., is an affiliate of West Palm Beach, Fla.-based Comvest Partners. ComVest Capital II LP, an equity fund operated by ComVest, has the biggest bankruptcy claim against Adayana—a $13.3 million claim, with about $12 million of it secured.
Seven other creditors have claims ranging from $104,167 to $361,209. Five others are seeking between $10,000 and $52,000.
Attorney Michael O’Neil from Taft Stettinius & Hollister LLP, who represents Adayana, said in October that Adayana had total debt of roughly $16 million and assets in the $8 million to $12 million range.
As part of the agreement, AVX will pay the cost of curing defaults on Adayana contracts.
The sale is expected to close by the end of the month.
Adayana was founded in Minneapolis in 2001, but moved its headquarters to Indianapolis in 2005 after acquiring local custom-training firm ABG Inc.
The company had as many as 300 employees two years ago, but had downsized to about 160 by mid-October, said founder and CEO Rajiv Tandon. About 60 of those work in Indianapolis, including fewer than 10 in corporate operations. The rest are in the company's Vertex Solutions division in Falls Church, Va., and other locations.
Adayana took on “tens of millions of dollars” of debt to make several acquisitions from 2005 and 2008. Those acquisitions didn’t live up to expectations when the recession hit and government contracts began to dry up, leaving the firm highly overleveraged.
The company said it hopes to keep most of its operations intact after the acquisition.