Inogen, Inc. (Nasdaq: INGN) has signed a definitive agreement to divest its U.S. oxygen rental business to Rotech Healthcare for a total estimated cash consideration of up to $25 million, according to a company statement.

The transaction is expected to close in the fourth quarter of 2026, subject to customary closing conditions. Separately, Inogen signed a long-term supply agreement with Rotech, under which Rotech will distribute Inogen's oxygen concentrators through its national network.

The rental business generated revenue of $24.3 million in the first half of 2026, a year-over-year decline of 9.8%. Beginning with its third-quarter 2026 financial results, Inogen expects to classify the rental business as discontinued operations, pending completion of its final accounting analysis.

Inogen said it expects the transactions to increase both its revenue growth rate and adjusted operating income. The company said it will continue selling products through home medical equipment distributors and a direct-to-consumer cash-pay channel.

"These transactions strengthen our business and financial profile, sharpen our strategic focus, and enable us to continue investing in innovative solutions that improve patient outcomes," said Kevin Smith, President and Chief Executive Officer of Inogen.

Contingent on the closing of the transaction, Inogen's Board of Directors has approved a $15 million increase to the company's existing share repurchase authorization, bringing the total to $45 million. The expanded authorization will expire on June 30, 2028, or when the maximum authorized amount has been utilized, whichever comes first. The company is under no obligation to purchase a specific number of shares, and the program may be suspended or terminated at any time.