Following a tumultuous period of financial difficulties and federal scrutiny over the effects of its medical closures on people, Steward Health Care System LLC filed for bankruptcy early on Monday.
According to the filing, the Dallas-based company is working with employer Medical Properties Trust Inc. to finalize a recovery loan. In the Southern District of Texas, it filed a request for Chapter 11 protection and listed both$ 1 and$ 10 billion worth of assets and liabilities.
Steward Health can continue to operate while the bankruptcy filing is in process of restructuring acceptance. Steward operates more than 30 institutions across eight claims and employs some 30, 000 people, according to its debt web. The country’s largest private, for-profit medical network.
Steward struggled to pay vendors and oversee operations at its sites, which contributed to the company’s cash crisis this year. The program moved to near facilities, including many in Massachusetts, to reduce costs. That prompted considerable opposition and inquiry from the country’s officials, including U. S. Sen. Elizabeth Warren.
According to Bloomberg, the company also made the decision to offer its managed services business and to work with consulting firm AlixPartners.
Medical components
According to a statement from Medical Properties, a U.S. real estate trust focused on healthcare facilities, the restructuring deal will give the company additional funding for up to$ 75 million and an additional loan of up to$ 225 million, subject to certain conditions. Steward Health received a$ 60 million bridge loan from Medical Properties in January, and some of its book debt have been delayed.
Medical Properties fell as much as 11.5 % in Monday exchanging as of 11: 20 a. m. New York time. Due to its finances and contact to Steward, MPT has received a quick strike.
Concerns about the private equity agency’s responsibility in Steward’s funds have also been addressed by Democrat lawmakers, including Warren. After purchasing St. Elizabeth’s and five different Catholic institutions in Massachusetts in 2010, private equity firm Cerberus established Steward.
According to Bloomberg’s 2021 report, Cerberus made an approximately$ 800 million revenue from its purchase before selling its remaining shares to specialists in the business, including Steward’s now-CEO Ralph de la Torre, in 2021.
The business attributed the higher costs and inadequate government-funded assistance to the factors that led to the Chapter 11 filing. Stewardship Health, its doctors business system, had to look for another source of funding due to the delay in selling it.
Through the debt process, de la Torre said in a statement that Stewart will be better positioned to responsibly transition rights of its Massachusetts-based facilities, maintain the continuity of care and provide for its patients and communities.
The event is Steward Health Care System LLC, 24- 90213, U. S. Bankruptcy Court for the Southern District Court of Texas.
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