Laser Spine Institute CEO shares details on why the company collapsed
The CEO of the locally based and grown Laser Spine Institute has come forward to share what took place before the well-known company suddenly announced it would shut its doors.
CEO Jake Brace said in a statement that the turn of events began on Feb. 22 when, "Laser Spine Institute’s banks precipitously and surprisingly made the decision to freeze the company’s accounts and strip the cash out of these accounts. When this happened, we lost our operating flexibility," he said.
Three days later, he said "management was able to reach a standstill agreement with the banks in which they we were allowed to fund previously accrued payroll and make limited other critical payments."
He said the banks gave the company until the afternoon of March 1 to locate an investor. "If we were not able to find an investor by then, we would be forced to wind-down and cease operations and liquidate the collateral for the benefit of the banks," the statement said.
LSI was unable to secure the financing to meet the banks’ requirements. "Thus, we had no choice other than to close our doors that afternoon. We deeply regret that, as a result, we were forced to release our employees that afternoon," he wrote.
Laser Spine has said nearly 600 local employees would be affected.
The layoff process started on March 1, when 354 employees were laid off; many more local employees will be affected by the end of the month.
"Despite last Friday’s sudden closure, forced by the precipitous freezing of LSI accounts, a small group of LSI staff continues to work strenuously on assuring that our patients maintain continuity of care. It is LSI’s plan that by the end of the week, we will have reached all 1,500 of patients and their new care plans will be in process," Brace's statement said.
His statement comes after LSI filed a Worker Adjustment and Retraining Notification Act notice to the state on March 4, which is also when class-action lawsuits were filed against the company by former employees.
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Laser Spine said it was working to reduce its operating costs, shuttering three surgical centers in the last six months.
The company had surgical centers in Tampa, St. Louis, Cincinnati and Scottsdale, Arizona. Its Tampa headquarters is near Tampa International Airport and International Plaza, a $56 million custom-built 176,000-square-foot campus that opened in 2016.