Steward Health Care said Monday it secured an additional $225 million in debtor-in-possession financing from some of its existing lenders.
Steward sought court approval for the proposed financing deal in a Tuesday filing. The money would keep healthcare operations running while Steward goes through Chapter 11 bankruptcy. A third of the sum, or $75 million, would be made available almost immediately, with future draws from the remaining funds capped at $50 million each, according to the filing.
Related: Justice Department objects to Steward's bankruptcy financing plan
Chief Restructuring Officer John Castellano said in the release Steward and its advisers conducted a thorough and competitive review of several proposals before taking the offer from a group of its secured lenders, which include WhiteHawk Finance, Owl Creek Investments and Brigade Capital Management.
In May, Steward's landlord, Medical Properties Trust, approved $75 million in debtor-in-possession financing to support Steward's healthcare operations, but has not offered more. Steward, at risk of running out of money, last week asked for court permission to offer a commitment fee and expense reimbursement to attract potential lenders.
Steward, which employs about 30,000 people, filed for Chapter 11 bankruptcy protection in May after months of financial issues.
Dallas-based Steward plans to sell all assets over the coming months, including 31 hospitals across eight states. Bids for physician group Stewardship Health and all hospitals, except those in Florida and Texas, must be submitted by June 24. Bids on the remaining assets must be submitted by Aug. 12.
The for-profit system already has a bid from UnitedHealth Group's Optum subsidiary to buy Stewardship Health.
