Victory Memorial granted court approval of bid procedures for $40 million asset sale

By Jennifer Lanning Drey

Portland, Ore., Feb. 25 - Victory Memorial Hospital obtained court approval of the bidding procedures for the proposed $40 million sale of some of its assets Thursday from the U.S. Bankruptcy Court for the Eastern District of New York, according to an attorney.

Holy Family Home is the stalking horse bidder.

When the company requested approval of the bid procedures, Victory Memorial said the asset sale is the final stage in implementing the New York State Commission on Healthcare Facilities in the 21st Century's recommendation that the hospital be closed.

The assets being purchased include the hospital's Brooklyn, N.Y., real property, Victory Memorial Hospital's 150-bed skilled nursing facility, the Victory Memorial Hospital Long Term Home Health Care Program and related equipment and assets.

If Holy Family is not the high bidder, Victory Memorial will pay it a $400,000 break-up fee.

Competing bids will be due at noon ET on March 10, and all bids must include a $1.5 million deposit.

Initial overbids must be for at least $500,000 more than the stalking horse bid, and subsequent overbids must be for at least $100,000 more than the previous bid.

The auction will be held March 13, and the hospital is asking the court to schedule the sale hearing for March 20.

Victory Memorial, a Brooklyn, N.Y.-based hospital, filed for bankruptcy on Nov. 15, 2006. Its Chapter 11 case number is 06-44387.

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