The tumultuous and twisting Mercy Iowa City bankruptcy took another stunning turn Friday when the hospital revealed that earlier in the day it reopened the auction, which it already closed, and changed its mind about who won — declaring the University of Iowa as having made the “higher or otherwise better” bid, instead of its largest bondholder Preston Hollow.
Mercy in a U.S. Bankruptcy filing Friday declared UI “the winning bidder” — due, in part, to a “material disagreement” with Preston Hollow, which outbid the university’s final $28 million bid with a $29 million offer at the close of the auction Oct. 10.
Despite more than two weeks passing since it declared Preston Hollow the auction winner, Mercy had not yet asked the court to set a hearing finalizing the sale — as attorneys grappled behind the scenes about details of the offer and hospital transition to new ownership.
“In the days that followed the conclusion of the auction, and prior to a sale hearing, a material disagreement arose between (Mercy) and (unsecured creditors), on the one hand, and the bondholders on the other hand,” according to Friday’s filing. “As a result of this material disagreement, (Mercy) after consulting with the (unsecured creditors), believed that the final bid submitted by the bondholders was not higher or otherwise better than the final bid submitted by the State of Iowa’s University of Iowa.”
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Mercy in a U.S. Bankruptcy filing Friday declared UI “the winning bidder” — due, in part, to a “material disagreement” with Preston Hollow, which outbid the university’s final $28 million bid with a $29 million offer at the close of the auction Oct. 10.
Despite more than two weeks passing since it declared Preston Hollow the auction winner, Mercy had not yet asked the court to set a hearing finalizing the sale — as attorneys grappled behind the scenes about details of the offer and hospital transition to new ownership.
“In the days that followed the conclusion of the auction, and prior to a sale hearing, a material disagreement arose between (Mercy) and (unsecured creditors), on the one hand, and the bondholders on the other hand,” according to Friday’s filing. “As a result of this material disagreement, (Mercy) after consulting with the (unsecured creditors), believed that the final bid submitted by the bondholders was not higher or otherwise better than the final bid submitted by the State of Iowa’s University of Iowa.”
This is a developing story. Check back for more details
Mercy reverses auction results; declares University of Iowa winner
The tumultuous and twisting Mercy Iowa City bankruptcy took another stunning turn Friday when the hospital revealed in a court filing that earlier in the day it re-opened the auction it already closed and changed its mind about who won – declaring the University of Iowa as having made the...
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