Newark, NJ—The Saint Michael's Medical Center Board of Directors named Prime Healthcare
Services as the successful bidder for the medical center. After a November
5 competitive auction, the two bidders—Prime Healthcare Services
and Prospect Medical Holdings—convened today to present their respective
credentials and vision to the Board before it carefully deliberated and
made its selection.
After careful consideration, and with the endorsement of the Creditor’s
Committee (per bankruptcy protocol), the Board selected Prime as the preferred
owner for Saint Michael's to continue to serve the Greater Newark
community. As a result of the competitive auction process, Prime will
pay $62.2 million or $13 million in excess of the initial bid submitted
($49 million), as well as agreeing to modify significant deal terms that
substantially benefit Saint Michael’s.
"Saint Michael's is essential to the Greater Newark community,
and the enthusiasm and commitment demonstrated by these quality bidders
is testament to the necessity for this community institution," said
David Ricci, president and CEO. "We look forward to a bright future
under Prime's leadership and thank Prospect Medical Holdings for its
The Board assessed the bids to determine which offer is in the best interest
of all stakeholders including to assure the long-term viability of Saint
Michael's which both bidders fully endorsed. The terms of the revised
Asset Purchase Agreement to be submitted to the court will include continued
current inpatient and outpatient services; charity care consistent with
current policies and levels; honoring the Ethical and Religious Directives
for Catholic Health Care; invest $50 million in capital improvements ($25
million more than initially agreed upon) to continue to modernize facilities
and support strategic needs in technology, equipment and services; and
to retain substantially all employees and physicians in good standing
when the sale is finalized.
"Almost three years ago, Prime came to the table with the best offer
to sustain the medical center," said Ricci. "Today, they remain
a committed partner and have renewed that commitment by paying $62.2m
and improving several material terms of their asset purchase agreement.
Most critically, the Prime sale will ensure that Saint Michael's has
a vibrant future, continues to serve the community and preserves the more
than 1,400 jobs of its dedicated staff."
“The bankruptcy auction process brought out the best in these two
high quality bidders," said Michael D. Sirota, counsel to Saint Michael’s.
"The Board considered every aspect of the offers and meticulously
exercised its fiduciary duty in selecting Prime. The Hospital is looking
forward to presenting Prime's bid to the Bankruptcy Court for approval
on Thursday and hopes that, given this rigorous sale process, the State
will quickly issue all regulatory approvals.”
A hearing to approve the selected buyer is scheduled for November 12, with
U.S. Bankruptcy Judge Vincent Papalia.
Director, Communications and Marketing
Saint Michael’s Medical Center
About Saint Michael’s Medical Center
Established by the Franciscan Sisters of the Poor in 1867, Saint Michael’s
is a 357-bed regional tertiary-care, teaching, and research center in
the heart of Newark’s business and educational district. Saint Michael’s
Medical Center is a member of Trinity Health. Learn more at
Reviewed by Cathy Toscano on November 10, 2015