Hammond Hanlon Camp LLC Advises on the Restructuring of University General Health System, Inc.
posted on May 26, 2016
CHICAGO — Hammond Hanlon Camp LLC (“H2C”), a healthcare-focused strategic advisory and investment banking firm, served as the exclusive financial and restructuring advisor to University General Health System, Inc. (“UGHS” or “the organization”) leading the operational improvement and sale process to conclusion through a Chapter 11 bankruptcy filing. On December 31, 2015 UGHS completed the sale of its assets including 69 bed University General Hospital and related affiliates to Foundation Surgical Hospital Holdings, LLC (“Foundation”).
UGHS initially engaged H2C in February 2015 to seek a strategic partner, and later requested H2C assist in obtaining DIP financing and provide financial advisory and operational restructuring services to the organization.
“The H2C team provided exceptional guidance throughout the bankruptcy process working with Management and the Board to stabilize operations, identify a partner and secure a future for UGHS”, said Dr. Hassan Chahadeh, Chairman of the Board of University General Health System.
H2C managed a multiple track process to provide guidance on stabilizing operations, assisting in meeting the expectations of stakeholders in the Chapter 11 proceeding and identifying interested parties. With operations stabilized and a new budget developed, a Confidential Information Memorandum was distributed to prospective buyers. Through a carefully managed sales process that highlighted the Hospital’s unique qualities, core competencies and investment opportunity, competitive bids were narrowed down in the third quarter of 2015 with a final bidder selected by UGHS after careful negotiation of an asset purchase agreement. With the cooperation of creditors and their representatives, the asset purchase agreement was signed in November 2015 and closed at year-end.
“The UGHS transaction was a unique challenge,” said Michael Lane, Managing Director of H2C. “The hospital was struggling financially resulting from a failed acquisition and changes in out of network reimbursement. Filing bankruptcy was necessary to provide sufficient time to execute a turnaround while simultaneously identifying a new partner. In addition, the initial term of the lease of the hospital real estate was expiring and the Organization had to simultaneously execute a ten year option. The restructured management team led by Dr. Chahadeh did an excellent job implementing changes necessary to improve operations and obtaining support from all the stakeholders in the bankruptcy leading to the approval and sale and transfer of assets to Foundation." Email Michael
ABOUT UNIVERSITY GENERAL HEALTH SYSTEM
University General Health System operates a 69 bed surgical hospital in Houston, Texas adjacent to the Texas Medical Center. The Hospital provides the full spectrum of inpatient and outpatient and surgical services including bariatric, orthopedic and spine in addition to other surgical services.
ABOUT FOUNDATION SURGICAL HOSPITAL HOLDINGS LLC
Foundation Healthcare, Inc., headquartered in Oklahoma City, OK, owns and operates surgical hospitals in the states of Texas and Oklahoma. The Company also has minority ownership interests in ambulatory surgery centers located in Texas, Pennsylvania, New Jersey, Maryland, and Ohio. The Company’s surgical facilities provide care for patients seeking general surgeries and specialty surgeries, such as orthopedics, neurosurgery, pain management, podiatry, gynecology, optometry, gastroenterology, and pediatric ENT (tubes/adenoids); and wound care, sleep management, radiology, imaging, and other ancillary services.
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 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.
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Dara Litwin
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"The H2C team provided exceptional guidance throughout the bankruptcy process working with Management and the Board to stabilize operations, identify a partner and secure a future for UGHS.”
- Dr. Hassan Chahadeh
Chairman of the Board
of UGHS
