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Steward Health Care System, the largest U.S. physician-owned hospital operator, is expected to file for chapter 11 bankruptcy as soon as Sunday, according to a WSJ report, which cited people familiar with the matter.
Steward Health Care is the largest tenant of Medical Properties Trust (NYSE:MPW). Steward Health Care hired restructuring advisers to improve its liquidity and restore its balance sheet in January.
Steward Health Care in late March struck a deal to offload its physician network to UnitedHealth’s (UNH) Optum Care arm. The deal was expected to help indebted Steward to resolve its immediate financial issues and allow it to repay all outstanding obligations to Medical Properties Trust (MPW).
Lawmakers, including Senator Elizabeth Warren (D-MA), urged regulators to “closely scrutinize” the transaction. The lawmakers laid out the anticompetitive impacts of the deal, noting that UnitedHealth (UNH) already has “massive market power” and this merger would further expand its consolidation of the market.
Medical Properties Trust (MPW) plunged 29% on January 5 after the REIT said it had taken steps to recover uncollected rents from Steward. Steward said it was pursuing strategic transactions to improve liquidity and restore its balance sheet, including the potential sale or re-tenanting of certain hospital operations and the divestiture of non-core operations.
