Iowa hospital seeks bankruptcy to implement acquisition plan
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An Iowa hospital filed for Chapter 11 bankruptcy this week, blocking a move by its largest bondholder to seek a court-appointed receiver and the immediate payment of principal and interest.
Monday’s filing by Mercy Hospital in U.S. Bankruptcy Court for the Northern District of Iowa posting on July 21, contending it had not defaulted.
In a July 24 notice to the hospital, Computershare Trust and Preston Hollow declared principal and unpaid accrued interest on all outstanding bonds under the master trust indenture “immediately due and payable.”
Moody’s Investors Service, which originally rated the 2011 bonds A2 and most recently downgraded the debt to Caa3, said Tuesday it withdrew the rating due to the bankruptcy filing.
