Hunter
08/31/23
A federal bankruptcy trustee is objecting to the speed and manner in which the proposed sale of Mercy Iowa City to the University of Iowa is being conducted.
Iowa Capital Dispatch reports trustee Mary Jensen has formally objected to proposed orders approving the bidding procedures and authorizing the hospital to provide certain financial protections to the university as the stalking horse bidder. She says adequate time has not been given for other prospective buyers to submit a bid by the September 19th deadline.
She also argues that the requirement that any other bid for Mercy be at least 6.5% higher than the U of I’s initial $20 million bid threatens to discourage competitive bids.
Tax records show that the hospital finished the 2022 fiscal year $16.8 million in the red after making $10.4 million the year before. Preston Hollow Community Capital claimed late last month that the hospital was in financial free fall and went to court to ask a judge to appoint a receiver. Mercy is trying to get that case dismissed.
The hospital says its liquidity will be insufficient to pay the cost of ongoing operations by late September.