The company is making sure that the hospital’s operations remain unaffected and does not immediately affect patients or staff.
HealthScope, the operator of Australia’s second largest private hospital, has been appointed by lenders to take the ship to receive it and corporate restructuring company McGrathnicol has been appointed to oversee the process.
The fought healthcare group, owned by North American private equity firm Brookfield, is struggling with a weight of $1.6 billion in debt and is liable for several lease payments.
Despite the economic upheaval, the company is making sure that hospital operations remain unaffected and will not immediately affect patients and staff.
HealthScope operates hospitals across all states and territories and has a contract to operate Northern Beach Hospital in Sydney.
Approximately 650,000 Australians receive treatment through the facility each year, with approximately 19,000 medical and support staff assisting them.
$100 million in additional funds to support operations
To ensure continuity in care, Commonwealth Bank has extended its $100 million loan facility to continue operating 37 HealthScope hospitals while the sales process is in progress.
The company said its daily business is continuing under its current leadership team led by CEO Tino La Spina, which is separated from the parent entities of its current host position.
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“The appointment of today’s recipients, including additional funds, ensures a stable path to sales without affecting the hospital, staff or patients,” said La Spina.
The company also revealed that it currently holds a cash reserve of $110 million.
Federal government monitoring transition
Health Minister Mark Butler replied that development is expected.
Kordamentha, an advisory and investment company, was appointed as an administrator representing the owner’s interests during the sales process.
“This decision to include HealthScope ownership in recipients is not unexpected. We have met as a government for quite some time with HealthScope,” Butler said.
He emphasized that protecting the interests of staff and patients will be a top priority for the government.
“From this decision, we want to make it clear that we expect an orderly sales process to emerge with new owners that do not affect patients and do not affect hard-working staff,” Butler said.
“I had a conversation with CEO Tino La Spina over the last 30 minutes, and I sought assurance from him that thousands of Australians currently having a birth plan or knee reconstruction booked at HealthScope Hospital would be sure the procedures were booked as planned and received that guarantee from Healthscope CEO.”
