Adeptus committee opposes financing, suggests change to case status

By Caroline Salls

Pittsburgh, June 2 – Adeptus Health Inc.’s official committee of unsecured creditors objected to approval of the company’s proposed debtor-in-possession financing, according to a Friday filing with the U.S. Bankruptcy Court for the Northern District of Texas.

The committee said the DIP facility “is structured to facilitate a streamlined process for the takeover of the Adeptus health care business by Deerfield.”

Although the committee said it has negotiated an extension of Adeptus’ Chapter 11 process to give it the opportunity to explore value-maximizing alternatives to the Deerfield plan and renegotiated “some of the other overreaching provisions found throughout the DIP” agreement, the creditor group said it “has not been able to change Deerfield’s desire to control the direction of these cases and restrict the exercise of the debtors’ and the committee’s respective fiduciary duties to maximize value.”

“The budget reflects what Deerfield believes is necessary to execute on its desired game plan,” the objection said. “And if one penny is spent in excess of the budget line items, the estate professionals, at Deerfield’s insistence, will have waived their statutory right to assert an entitlement to an administrative claim.”

“Simply put, if Deerfield will not pay for the tremendous benefit of Chapter 11, then perhaps the cases should be dismissed and Deerfield should attempt to assert its rights as a secured creditor under applicable state law or the debtors’ cases should be converted to Chapter 7.”

Based in Lewisville, Texas, Adeptus maintains a network of freestanding emergency rooms and partnerships with health care providers. The company filed bankruptcy on April 19 under Chapter 11 case number 17-31432.

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