Steward Health Care, the largest private hospital operator in the United States, received bankruptcy approval Wednesday to sell six Massachusetts hospitals, despite not making a profit on the $343 million sale.
Bankruptcy Judge Christopher Lopez approved the sale as “the best deal on the table,” during a court hearing in Houston, Texas.
The sale will allow Steward to cut losses and minimize disruption to patients, although the company will not make any money from the sale, Steward’s attorney, Candace Arthur, told Lopez.
Most of the money raised from the sale will go toward the purchase of the hospital’s buildings, which are owned by Medical Properties Trust (link) MPW and Macquarie. Steward’s other liabilities exceed the modest sum the buyers agreed to pay for the hospital operations and separate businesses, Arthur said.
Steward previously sold his Massachusetts real estate holdings in a 2016 transaction that was criticized (link) by Massachusetts politicians and U.S. senators.
Massachusetts supported the sale, agreeing to provide $42 million in funding to hospitals in September. Massachusetts had previously provided a $30 million lifeline (link) to hospitals.
Under the approved sales agreements, Rhode Island-based Lifespan Health System will acquire Saint Anne’s Hospital in Fall River and Morton Hospital in Taunton for $175 million; Boston Medical Center will acquire Good Samaritan Medical Center in Brockton and St. Elizabeth’s Medical Center in Boston for $140 million; and Lawrence General Hospital will acquire Holy Family Hospitals in Methuen and Haverhill for $28 million.
Steward had previously announced the closure of two other hospitals in Massachusetts (link) and two hospitals in Ohio (link).
In May, Dallas-based Steward filed for bankruptcy protection (link), seeking to sell all of its hospitals to pay off $9 billion in debt. Before the announced closures, Steward operated 31 hospitals in eight states.
