CONCORD — U.S. Bankruptcy Court Judge Michael Fagone cleared the way Wednesday for Concord Hospital to purchase the assets of LRGHealthcare — including Lakes Region General Hospital and Franklin Regional Hospital — for $30 million.
“We are extremely pleased that all parties connected to the case found a way forward to sell LRGHealthcare’s assets to Concord Hospital,” said LRGHealthcare CEO and President Kevin Donovan.
“This is ultimately excellent news for the health of the Lakes and Three Rivers Regions communities and we are now eager to begin the regulatory approval process.”
Most objections to the sale were resolved in a hearing Monday, with the exception of the state’s concerns about the wording of provisions for it to recoup money owed in connection with a state program used to fund uncompensated care for those patients who are unable to pay.
Clarifying language was entered into sale documents Wednesday to deal with this concern.
LRGHealthcare went into Chapter 11 bankruptcy after struggling under the burden of heavy debt, chiefly a $111 million facility mortgage owed to Key Bank and insured by the U.S. Department of Housing and Urban Development.
Key Bank and HUD agreed to a plan under which net proceeds from the sale would go toward this debt, but on Wednesday raised additional objections. Fagone overruled those objections, finding they had already agreed to the plan.
He asked that minor revisions to sale documents be made before his formal approval is entered in the record.
An auction that had been scheduled among parties interested in buying LRGHealthcare’s assets was cancelled because Concord Hospital emerged as the only health care institution interested in making an acquisition bid.
The next step will be for the parties to seek approval from regulatory agencies.
LRGHealthcare and Concord Hospital expect to complete this process in 2021.
LRGHealthcare has 1,400 full- and part-time employees and is the largest employer in the Lakes Region.
Even before the impact of COVID-19, LRGHealthcare was consistently losing $1 million a month and hindered by the burden of servicing its large debt.
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