Bankrupt nursing home provider Integrated Health Services, Sparks, Md., last week reached a nearly $55 million settlement with one of its founders, Robert Elkins, M.D., sealing Elkins' agreement to leave the company and make way for new leadership.
Elkins, 56, will leave his posts as chairman, chief executive officer and president of IHS once the U.S. bankruptcy court in Wilmington, Del., approves the deal. Joseph Bondi, the company's chief restructuring officer, will replace him as CEO.
Bondi, formerly a senior vice president of Republic Health Corp., was hired by the turnaround consulting firm Alvarez & Marsal as chief restructuring officer last July. At the time, IHS announced its intent to part ways with Elkins and to name Bondi to the top executive position.
Under the settlement, IHS will pay Elkins $1.5 million in cash, forgive $34.5 million in loans made to him for IHS stock and cover his $18.9 million tax liability resulting from the loan forgiveness, the Associated Press reported. Elkins will provide 100 hours of consulting to IHS during the year.
At deadline, neither IHS officials nor their bankruptcy attorney could be reached for comment.
IHS sought Chapter 11 protection last February after losing $2.6 billion in 1999. Analysts said too rapid expansion is at least partly responsible for the troubles. IHS owns about 360 skilled-nursing facilities and 17 specialty hospitals.