Steward Health Care, a leading healthcare provider with eight hospitals in Massachusetts and over 20 more across the United States, has successfully secured a $225 million loan to ensure its continued operations. This significant financial support, subject to approval by a bankruptcy judge, comes just three days before Steward was projected to exhaust its funds.
On May 6th, Steward filed for Chapter 11 bankruptcy and initially received a $75 million loan from Medical Properties Trust (MPT), the landlord for most of its hospitals. However, MPT declined further funding for this deal and other pre-bankruptcy bridge financing lenders stepped in. The largest hospital REIT reported a net loss of $736 million in Q1 due to Steward’s financial struggles.
As part of their restructuring plan under Chapter 11 bankruptcy protection, Steward has agreed to sell all their hospitals through two separate auctions by the end of June which will impact operations across multiple states. In addition to these challenges faced by MPT’s tenant Prospect Medical Holdings who missed rent payments in April and May have added further strain on MPT’s finances.
