Another Class I recall for Medline | Truist Bank suffers major data breach | SouthRock Capital files chapter 15 bankruptcy

In today’s Portfolio Intelligence Daily:?

• Another Class I recall for Medline
• Truist Bank suffers major data breach
• SouthRock Capital files chapter 15 bankruptcy

Our analyst team curates these summaries from Auquan’s Intelligence Engine, which uses generative AI and retrieval augmented generation (RAG) to uncover material non-financial insights at scale to support deal sourcing, due diligence, risk monitoring, and compliance.

Industry insights and trends:

• Tackling Information Overload in the Age of AI [private credit] (TDWI Upside)
• How RAG completes the generative AI puzzle (InfoWorld) — Retrieval-augmented generation brings to generative AI the one big thing that was holding it back in the enterprise.
• Will AI be transformative for ESG data? (Environmental Finance)
• Why AI is finally catching up with financial services (Maddyness)

Another Class I recall for Medline

The FDA has elevated a recall involving Medline Industries, a device distributor, which is pulling tens of thousands of endotracheal tubes from use.

• Medline’s SubG ventilation tubes are designed to deliver oxygen down the throat into the lungs. The FDA reported that components of the tubes can detach or tear off the main tube during use.
• The FDA has received three reports of injuries, but no deaths, associated with the device.
• The recall affects over 13,000 kits distributed nationwide, containing more than 168,000 tubes.
• The FDA categorized this recall as a Class I recall, its most serious category.
• Medline first alerted healthcare providers to the problem in late February, expanded the recall in March, and offered credits to customers for the impacted equipment.

Select timeline

• June 13, 2024 | FDA elevates Medline recall of endotracheal ventilator tubes (Fierce Biotech)
• June 12, 2024 | FDA tags Medline recall of endotracheal tubes as Class I ? (Medical Device Network)
• Feb 14, 2024 | FDA announces recall of more than 50,000 infusion pumps (Health Exec)

Truist Bank suffers major data breach

Truist Bank confirmed a cyberattack in October 2023 after a threat actor posted some of the company's data for sale on a hacking forum.

• Sp1d3r, a threat actor, is selling what they claim is stolen data containing information of 65,000 employees for $1 million,
• The stolen data allegedly includes bank transactions with names, account numbers, balances, and IVR funds transfer source code.
• Truist Bank stated that the cybersecurity incident was quickly contained in October 2023.
• Based on new information from the ongoing investigation, Truist Bank has notified additional clients and found no indication of fraud arising from this incident.

Select timeline

• June 14, 2024 | Data breach confirmed by Truist Bank following Sp1d3r claims (SC Media)
• June 14, 2024 | Hackers Expose Truist Bank's Data on Dark Web, Confirming October Breach (Bitdefender)
• June 13, 2024 | Truist Bank confirms breach after stolen data shows up on hacking forum (Bleeping Computer)

SouthRock Capital files chapter 15 bankruptcy

SouthRock Capital, a restaurant operator in Brazil, filed for Chapter 15 bankruptcy in Texas.

• The company had previously operated Starbucks and Subway units in Brazil but lost these rights due to financial difficulties.
• The pandemic and the persistent instability of the Brazilian economy significantly impacted SouthRock's business, with revenues decreasing 95% in 2020 and 70% in 2021.
• A debt default in September 2023 led to the termination of the Starbucks agreement and lenders calling $26.7 million in loans. Subway ended its relationship with SouthRock in November 2023.
• The company expects to restructure in Brazil and needs the U.S. bankruptcy process to protect its U.S. assets from potential adverse actions by creditors or other parties.
• Since 2020, SouthRock has accumulated over $200 million in losses, with liabilities including $23.3 million in secured debts and nearly $22 million in unpaid royalties.

Select timeline

• June 14, 2024 | A Brazilian TGI Fridays operator declares bankruptcy (Restaurant Business Online)
• Dec 13, 2023 | Brazil court OKs bankruptcy protection for Starbucks, TGI Fridays operator (Reuters)
• Nov 3, 2023 | Group Controlling Starbucks Brazil Loses License to Operate the Brand in the Country (Folha de S.Paulo)

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