Hospital Partners gets OK to auction St. Joseph Medical Center stake

By Caroline Salls

Pittsburgh, March 24 - Hospital Partners of America, Inc. Chapter 7 trustee Alfred T. Giuliano received court approval of the bidding procedures for the proposed $155 million sale of debtor SJ Medical Center Management, LLC's 78.2% membership interest in SJ Medical Center, LLC (St. Joseph Medical Center), according to a March 24 filing with the U.S. Bankruptcy Court for the District of Delaware.

St. Joseph is a 792-bed facility in downtown Houston.

IASIS Healthcare LLC is the stalking horse bidder and is entitled to receive a $5 million break-up fee and reimbursement of up to $500,000 in expenses if it is not the highest bidder at auction.

IASIS has made a good faith deposit of $7 million.

The initial overbid must be $8 million more than the stalking horse bid.

Minimum overbids must be in increments of at least $2.5 million.

According to IASIS, a group of independent investors, most of whom are physicians on the medical staff of St. Joseph Medical Center, will retain a 21.8% ownership interest in the hospital.

The sale is expected to close in the third quarter of 2011.

The auction will be held on April 18, if necessary, and the sale hearing is scheduled for April 20.

Hospital Partners of America, a Charlotte, N.C.-based privately held company that develops and operates hospitals, filed for bankruptcy on Sept. 24, 2008. Its Chapter 7 case number is 08-12180.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.