MED Healthcare Partners has made a stalking horse bid of $69 million to purchase the bankrupt 1,038-bed nonprofit Henry Ford Village retirement community in Dearborn.
The bid is in accordance with procedures approved by the U.S. Bankruptcy Court for the Eastern District of Michigan, Southern Division, in Detroit. It remains subject to higher or better offers in accordance with the bid procedures and deadlines, as well as court approval.
A stalking horse offer is a bid for a bankrupt firm or its assets that is arranged in advance of an auction to act as an effective reserve bid. The intent is to maximize the value of its assets or avoid low bids, as part of a court auction.
MED Healthcare Partners and its affiliates currently manage and operate 150 skilled nursing facilities, 20 assisted living and memory care communities, and five continuing care retirement communities in 20 states.
“When we first began this process, we did so with the goal of fulfilling the nonprofit’s mission and maintaining the standard of living and values our community strives to achieve,” says Chad Shandler, chief restructuring officer for Henry Ford Village.
“The bid offered by MED has recognized those values in the best interests of our residents, our employees, and ultimately, our whole community. We’re pleased to establish a solid baseline bid at this stage of our restructuring as we move our community forward towards successfully emerging bankruptcy in a manner that maintains the health, safety, and lifestyle of our residents for years to come.”
The deadline for competing offers to be submitted is set for April 30. A hearing to approve the sale transaction currently is scheduled for May 24.
“As the proud owner and operator of a variety of senior living communities throughout the U.S., we know that the deep sense of care within the Henry Ford Village community is unique and worth preserving,” says Samuel Feuer, an owner and operator at MED. “We’re excited to have reached an agreement with HFV, albeit subject to higher or better bids, that will allow us to expand our network while extending the community’s ability to serve its residents and employees now and in the future.”
Donald Jesmore, a resident board member at Henry Ford Village, says, “As a resident of this community as well as a board member, I knew that one of the primary goals was to restructure in a way that would create a stronger financial foundation for the residents of our community without negatively impacting resident lifestyle. With this initial bid, we believe we have a means to meet that goal, as well as a path towards enhancing the facility and residential experience. We are glad that potential purchasers appreciate our home and the importance of the role our employees have in our operations by seeking to maintain the bulk of the employee base. We are encouraged by MED’s commitment to the wonderful community many have come to know, love and rely on, and we expect any other potential buyers would view Henry Ford Village the same.”
The APA and all relevant sale-related court filings, as well as additional information about Henry Ford Village’s Chapter 11 case, are available here.
Henry Ford Village is represented in this matter by Detroit law firm Dykema Gossett. FTI Consulting in Troy is serving as chief restructuring officer and restructuring advisor.