Company Profile: INNOVATE Corp. (formerly HC2 Holdings, Inc.)

Background

INNOVATE Corp., previously known as HC2 Holdings, Inc., is a diversified holding company headquartered in New York City. The company focuses on acquiring and managing a portfolio of subsidiaries across three primary segments: Infrastructure, Life Sciences, and Spectrum.

Key Strategic Focus

INNOVATE Corp. aims to build a portfolio of best-in-class assets poised to thrive in the new economy. The company's strategic focus includes:

Infrastructure: Through its subsidiary DBM Global, INNOVATE provides integrated steel construction and professional services, including design-assist, modularization, fabrication, and erection of structural steel.

Life Sciences: The Pansend Life Sciences segment invests in innovative healthcare technologies and products, such as R2 Technologies' CryoAesthetic™ medical devices and MediBeacon's real-time kidney function monitoring system.

Spectrum: HC2 Broadcasting Holdings, Inc., operates approximately 230 broadcast stations across over 90 U.S. TV markets, offering a flexible and scalable platform to content providers.

Financials and Funding

INNOVATE Corp. has undertaken several financial initiatives to strengthen its capital structure:

Divestitures: In July 2021, the company completed the sale of its insurance segment to Continental General Holdings LLC for $90 million, comprising $65 million in cash and securities.

Acquisitions: In May 2021, DBM Global acquired Banker Steel Holdco LLC for $145 million, enhancing its geographical footprint and service offerings.

Credit Agreements: DBM Global secured a $220 million credit agreement, consisting of a $110 million revolving credit facility and a $110 million term loan, to finance the Banker Steel acquisition and other corporate purposes.

Pipeline Development

INNOVATE's Life Sciences segment, Pansend Life Sciences, has several key developments:

R2 Technologies: Launched Glacial Rx™, the first FDA-cleared CryoAesthetic™ age spot removal treatment, in April 2021.

MediBeacon: Developing a non-invasive, real-time monitoring system for kidney function, which has received breakthrough device designation from the FDA.

Technological Platform and Innovation

INNOVATE Corp. leverages proprietary technologies and scientific methodologies across its segments:

CryoAesthetic™ Technology: R2 Technologies' Glacial Rx™ utilizes patented cooling technology to suppress melanin production and remove age spots.

Real-Time Monitoring: MediBeacon's platform offers non-invasive, real-time monitoring of kidney function, providing critical data for patient care.

Leadership Team

Avie Glazer: Chairman of the Board.

Wayne Barr, Jr.: President and Chief Executive Officer.

Leadership Changes

In July 2021, the company announced a name change to INNOVATE Corp., reflecting its focus on innovative growth businesses.

Competitor Profile

Market Insights and Dynamics

INNOVATE Corp. operates in diverse sectors, each with unique market dynamics:

Infrastructure: The U.S. infrastructure market is experiencing growth due to increased government spending on construction and maintenance projects.

Life Sciences: The healthcare sector continues to expand, driven by technological advancements and an aging population.

Spectrum: The broadcasting industry is adapting to changing consumer preferences, with a shift towards over-the-air (OTA) content consumption.

Competitor Analysis

INNOVATE Corp. faces competition from various companies across its segments:

Icahn Enterprises: A diversified holding company with investments in multiple sectors.

ALJ Regional Holdings: Focuses on acquiring and operating businesses in different industries.

Anywhere Real Estate: Provides residential real estate services, including franchise, brokerage, and title services.

Graham Holdings: Engages in education and media activities, among other sectors.

Strategic Collaborations and Partnerships

INNOVATE Corp. has established significant partnerships to enhance its market position:

Huadong Medicine Company Limited: In February 2021, R2 Technologies received a $10 million investment from Huadong, granting them exclusive distribution rights in China and selected Asia-Pacific markets.

Operational Insights

INNOVATE Corp.'s diversified portfolio provides a competitive advantage by mitigating risks associated with any single industry. The company's focus on innovation and strategic acquisitions positions it well against competitors.