LifeCare Holdings, Plano, Texas, bought itself more time from its creditors as it weighs various options to deal with its debt load, including a potential sale.
The company obtained loan waivers
from its senior secured lenders and a majority of its senior subordinated noteholders after it defaulted on an Aug. 15 interest payment.
The waivers give the long-term acute-care hospital operator until Nov. 1 to find a longer-term solution for its debt woes. LifeCare said in a news release that it will use the additional time to continue talks with “creditors, potential buyers and other interested parties.”
“We continue to evaluate various strategic options to restructure our debt and position the company for future growth,” Chairman and CEO Phillip Douglas added in the release.
LifeCare engaged Rothschild as a financial adviser on May 8 to explore various options to manage its debt, according to an Aug. 14 earnings release
The company, which had $456.4 million in debt as of June 30, failed to make the $5.5 million interest payment due Aug. 15 on its senior subordinated notes, which constituted an event of default after a 30-day grace period.