Quincy Medical Center files bankruptcy to complete $38 million sale

By Caroline Salls

Pittsburgh, July 1 - Quincy Medical Center, Inc. filed Chapter 11 bankruptcy Friday in the U.S. Bankruptcy Court for the District of Massachusetts amid plans to sell substantially all of its assets to Steward Medical Holdings Subsidiary Five, Inc. and Steward Medical Holdings LLC for $38 million.

Steward's offer will serve as the stalking horse bid for the proposed asset sale. Competing bids must exceed the stalking horse bid by at least $1 million, plus an $875,000 break-up fee to be paid to Steward if it is not the high bidder at auction.

The asset sale is subject to approval by the bankruptcy court, the Massachusetts Department of Public Health and the Office of the Attorney General of Massachusetts.

Quincy Medical said it hopes the regulatory process can be completed and the sale closed by Oct. 1.

The bid procedures hearing is scheduled for July 6.

In connection with the bankruptcy filing, the company is seeking access to the cash collateral of is pre-bankruptcy secured revenue bondowners to fund its operations during the sale process.

According to court documents, Quincy Medical Center has $50 million to $100 million in both assets and debt.

The medical center's largest unsecured creditor is Healthplans Inc. of Westborough, Mass., with a $1.34 million insurance claim. The company did not list any other unsecured creditors with claims of $1 million or more.

The company has retained Casner & Edwards, LLP as counsel and hired Navigant Capital Advisors LLC as its financial adviser.

Quincy Medical Center's Chapter 11 case number is 11-16394.

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