“Furthermore, it was troubling to the Court that the Debtor’s financial advisor and investment banker each testified that neither had done any due diligence with respect to Empower’s ability to close the transaction, but that they advised the Board to accept the Empower Final Bid,” Khan’s order says. Khan was also critical of the Morehead board’s judgment in declaring Empower the winning bidder. “The evidence and testimony was not credible and tended to demonstrate that Empower did not have the ability to consummate the transaction or fulfill its obligations post-closing, or that the estate or any other entity would be able to enforce any breach.”Īmong the problems Khan identified was that Empower had just $5,000 in its bank account and that its “purported letter of commitment” for $15 million required Morehead’s real estate assets to be appraised at nearly twice the $10.76 million bid. Bankruptcy Court Judge Benjamin Khan wrote in his order approving the sale to UNC. “The Sale Hearing on Novemdid not go well for Empower,” U.S. 8 hearing in federal court in Greensboro, questions were raised about Empower’s ability to actually close the transaction and continue to operate the hospital. 23 deadline for bids and its proposal to buy Morehead’s assets raised plenty of questions. But that company formed just one week before the Oct. Initially, Morehead Memorial trustees declared a little-known Florida company, Empower IHCC Inc., the winner. The hospital’s board received bids from seven entities - some of them for all the hospital’s assets, some for just some. The bankruptcy filing led to an auction that included some drama about which bidder would win. “We get to focus on answering these sorts of strategic questions that we really haven’t had the breathing room to be able to do.” Failed bidder “What are the services that our community needs most? What are the services that our community is having to leave our local area to get? Where should we specialize? What are we best at?” she said. Then, probably later in the first quarter, the hospital will start a new strategic planning process to identify how the hospital can compete and be financially sustainable. Weston said the first task on her to-do list is integrating UNC Rockingham’s finance, information technology, human resources and other systems with the UNC system. It will likely be months, though, before details are released of how that $20 million might be used.
In addition, UNC agreed to invest another $20 million in capital investments at the hospital over the next three years. Under the terms of the deal, outlined in a lengthy bankruptcy court filing, UNC Health Care paid $11.5 million for Morehead Memorial’s assets. The hospital-owned nursing home was renamed UNC Rockingham Rehabilitation and Nursing Care Center. The transaction was completed Monday and the new name and other details announced Tuesday. Last July, that effort led to a last-ditch attempt by Morehead to find a buyer by filing for bankruptcy so it could shed debt that, hospital leaders had learned, was scaring potential purchasers away. The deal was the culmination of a years-long effort by Morehead Memorial leaders to sell itself to a larger hospital system. “Last year was quite a journey and yesterday was an important milestone, but it’s not the end of the work.” Morehead Memorial CEO Dana Weston. “All of us are focused on making this transition as smooth as possible,” said Dana Weston, who was president of Morehead Memorial and will stay on as a UNC employee to run the hospital under its new name. UNC Health Care finalized its purchase of Morehead Memorial Hospital this week and announced the hospital would now be called UNC Rockingham Health Care. Lessons from Abroad: How Europeans have tackled opioid addiction and what the U.S.Storm stories – NC Health News works with teens from SE North Carolina to tell their hurricane experiences.Unequal Treatment: Mental health parity in North Carolina.Youth climate stories: Outer Banks edition.
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