Dallas-based predictive AI company Spectral AI plans to spin off its Spectral IP subsidiary as an independent public company via a transaction with Sauvegarder Investment Management Inc., a development-stage company focused on IP-based financing and monetization.

Following the spinoff, Spectral IP—to be renamed SIM IP Inc.—will focus on providing IP-based financing and monetization solutions across various industries. It will be headquartered in Miami, Florida.

In April, Spectral AI announced that Erich Spangenberg had been appointed CEO of Spectral IP. Following the completion of the separation, SIM IP will be led by Spangenberg, with David Kutcher as chief financial officer.

Spectral AI, which focuses on medical diagnostics for faster and more accurate treatment decisions in wound care, said the spinoff aligns with its strategy to maximize shareholder value by fostering growth in its subsidiary, Spectral IP, to monetize intellectual property assets relevant to the broader AI ecosystem with a specific emphasis on healthcare that offers significant growth potential outside of its core focus on medical diagnostics.

“We believe this spinoff represents an exceptional opportunity to unlock additional value for our shareholders,” Dr. J. Michael DiMaio, founder and chairman of Spectral AI, said in a statement. “With the spinoff transaction, we are creating a distinct pathway for targeted intellectual property investments outside our core focus on medical diagnostics. This strategic move enables Spectral IP to explore and capitalize on significant opportunities beyond medical diagnostics while driving innovation and growth in the broader IP landscape.”

All of Spectral AI’s 26 patents and 38 patent applications will remain with Spectral AI. the company said.

Details of the deal

The spinoff is expected to deliver key advantages, the company said, including a sharper strategic focus with supporting resources, optimized capital allocation priorities, enhanced shareholder value, and expanded strategic opportunities for Spectral IP.

Spectral AI said it anticipates that the transaction will be in the form of a distribution to its shareholders of stock of Spectral IP, which will become a new, independent publicly traded company.

Spectral AI also said it currently expects the transaction to be completed within the next 90 days.

In March 2024, Spectral AI announced the formation of its Spectral IP subsidiary to advance intellectual property relevant to the broader AI ecosystem, with a specific emphasis on healthcare.

The company also announced that Spectral IP had received a $1 million investment, and that Spangenberg was appointed chief executive officer of the subsidiary. Spangenberg is Spectral AI’s largest shareholder and has a strong track record in global IP investment, monetization, enforcement, acquisition, and licensing.

More on the spinoff

The company said that SIM IP’s approach will include licensing, litigation investment, structured financing, royalty acquisitions, and opportunistic transactions.

Spectral said that while SIM IP will remain industry-agnostic, its target sectors include healthcare, semiconductors, AI, and IoT—”hard tech” sectors with longer replacement cycles commonly ignored by other investors and frequently infringed.

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