Verity gets green light to sell 384-bed hospital to Prime Healthcare

August 13, 2020 – Verity Health System of California (El Segundo, CA) won bankruptcy court approval to sell 384-bed St. Francis Medical Center (Lynwood, CA) to Prime Healthcare Services (Ontario, CA). The sale happened in spite of objections for the California Attorney General Xavier Becerra and a last-minute attempt from an opposing bidder to block the sale.

Verity said three of the conditions were overly burdensome. The disputed conditions revolved around the amount of charity care and community-benefit services the hospital would need to provide. As a result, the attorney general opposed authorizing the sale and approving Verity’s Chapter 11 liquidation plan, according to the The Wall Street Journal.

U.S. Bankruptcy Judge Ernest Robles overruled the objections, which should allow the $350 million sale to finalize. The judge also said he would approve Verity’s Chapter 11 liquidation plan.

Then, in late July, Prospect Medical Holdings (Los Angeles, CA) made a last-minute attempt to block Prime from buying St. Francis Medical Center. Prospect Medical, backed by a private equity firm, reportedly offered to pay $50 million more than Prime and offered to accept all of the attorney general’s conditions.

Read the Full Article

(Subscription Required)