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A bankruptcy judge has ruled that the Orlando Health system is a “qualified bidder” and signed off on certain bid protections in its attempt to buy three hospitals in Brevard and Indian River counties as part of the bankruptcy of hospital operator Steward Health Care.
U.S.. Bankruptcy Judge Christopher Lopez on Thursday also approved Orlando Health’s designation as what is known as a “stalking horse bidder,” which sets an initial bid.
Other potential buyers of the three hospitals face a Monday deadline for submitting bids, Lopez’s order came three days after Medical Properties Trust, Inc., which owns the hospital properties and leases them to Steward, challenged the Orlando Health proposal, alleging it did not comply with bidding procedures.
The objection stemmed from the bid not distinguishing between the values of hospital operations and the real estate.
But the Texas-based Lopez ruled that “the stalking horse agreement (between Orlando Health and Steward) is a qualified bid, and the stalking horse bidder is a qualified bidder, for all purposes and requirements pursuant to the global bidding procedures.”
In its proposal, Orlando Health would pay $439 million in cash for Melbourne Regional Medical Center, Rockledge Regional Medical Center and Sebastian River Medical Center, though the amount could be adjusted based on a series of factors, according to the proposed agreement filed Aug. 14.
Dallas-based Steward filed for Chapter 11 bankruptcy in May.
Melbourne Regional Medical Center and Rockledge Regional Medical Center are in Brevard County, while Sebastian River Medical Center is in Indian River County.
In addition to those hospitals, Steward owns Coral Gables Hospital, Hialeah Hospital, North Shore Medical Center and Palmetto General Hospital in Miami-Dade County and Florida Medical Center in Broward County.
It also has operated hospitals in Arizona, Arkansas, Louisiana, Massachusetts, Ohio, Pennsylvania and Texas.
