Hammond Hanlon Camp LLC Advises Morehead Memorial Hospital on the Sale of Its Assets to University of North Carolina Health Care
posted on June 14, 2018
CHICAGO — Hammond Hanlon Camp LLC (“H2C”), a healthcare-focused strategic advisory and investment banking firm, served as the exclusive financial and restructuring advisor to Morehead Memorial Hospital (“Morehead” or “the Organization”) in Eden, N.C., leading the marketing and sale of the hospital and its skilled nursing assets to the University of North Carolina Health Care ("UNC Health").
On Dec. 31, 2017, Morehead completed the sale—which included the 108-bed hospital and 121 skilled-nursing beds at the adjacent Morehead Nursing Center and its related affiliates—to UNC Health. H2C led the marketing and sale process to conclusion through a Chapter 11 bankruptcy filing.
UNC Health's bid included $11.5 million in cash and liability assumption and $20 million in capital investment, ensuring the Rockingham County community continues to have access to high-quality care and service close to home.
"In the end, this was the right thing to do for the future of healthcare in Rockingham County," says Michael Lane, Managing Director, H2C. "UNC Health stepped in and took ownership of a challenging market, ensuring the long-term viability of healthcare services in the county." Email Michael.
Morehead began its search process to address challenges common to many small community hospitals, including regulatory changes, deteriorating demographic trends, increased capital needs, and challenges with physician and nursing recruitment and retention, among others.
In 2016, Morehead’s Board of Directors analyzed the Organization's ability to continue meeting its mission as a provider of high-quality care and service for the Rockingham County community. Once Morehead determined the need for a strategic partner, Morehead retained H2C to assist the Organization in finding a strategic partner that could help Morehead address the challenges it faced.
H2C conducted a full partnership selection process that highlighted the key strengths of Morehead and its value as an acute care provider in the Rockingham County community. Despite a robust partnership search, Morehead's high debt levels required the Board to put the Organization through a Chapter 11 bankruptcy process before it could successfully attract a partner to take over operations.
In July 2017, Morehead engaged H2C to help stabilize operations and guide the organization through a Chapter 11 bankruptcy. H2C provided a Chief Restructuring Officer to offer in-person support and expertise as well as a steady presence on the operations side.
Through a carefully managed process that highlighted Morehead’s unique market position, core competencies, and investment opportunity, bids were narrowed down in the fourth quarter of 2017. Ultimately, UNC Health was selected as the winning bidder.
Leaders of both organizations agreed that a partnership would have tremendous benefits for the community. The affiliation with UNC strengthens Morehead—now known as UNC Rockingham Health Care—and continues to provide an important community service for patients and a source of stability for other area providers and the organization's employees. All employees in good standing became part of the new organization.
“In the end, this was a great outcome for Morehead and the Rockingham County community as well as for Morehead's employees,” said H2C's Lane.
“H2C was our advocate throughout the merger-and-acquisition process,” said Dana Weston, president of UNC Rockingham Health Care, who formerly served as CEO of Morehead. "They were instrumental in leading us through unfamiliar territory—the Chapter 11 filing bankruptcy process—and provided boots-on-the-ground support and expertise during a challenging period in our history. Today, our organization is well-positioned to continue meeting its vision of being the regional healthcare system of choice."
623 Fifth Avenue
New York, NY 10022
3333 Piedmont Road
Atlanta, GA 30305
311 South Wacker Drive
Chicago, IL 60606
4655 Executive Drive
San Diego, CA 92121
ABOUT UNC Rockingham Health Care (Formerly Morehead Memorial Hospital)
UNC Rockingham Health Care, formerly known as Morehead Memorial Hospital, became part of UNC Health Care in December 2017, unveiling its new name on Jan. 1, 2018. The organization has a long history of serving patients and families in the Rockingham County region. UNC Rockingham Health Care includes UNC Rockingham Hospital; the adjacent skilled nursing facility, UNC Rockingham Rehabilitation and Nursing Care Center; and a new cancer clinic, UNC Cancer Care at Rockingham. For more information, visit www.uncrockingham.org/.
ABOUT HAMMOND HANLON CAMP LLC
Hammond Hanlon Camp LLC (“H2C”) is an independent strategic advisory and investment banking firm committed to providing superior advice as a trusted advisor to healthcare organizations and related companies throughout the United States. H2C’s professionals have a long track record of success in healthcare mergers and acquisitions, capital markets, real estate, and restructuring transactions, acting as lead advisors on hundreds of transactions representing billions of dollars in value. Hammond Hanlon Camp LLC offers securities through its wholly-owned subsidiary H2C Securities Inc., member FINRA/SIPC. For more information, visit h2c.com.
Kelly T. Duong
Hammond Hanlon Camp LLC
“H2C was instrumental in leading us through unfamiliar territory—the Chapter 11 filing bankruptcy process—and provided boots-on-the-ground support and expertise during a challenging period in our history. Today, our organization is well-positioned to continue meeting its vision of being the regional healthcare system of choice."
- Dana Westo, President of
UNC Rockingham Health DaDare