Saint Vincent seeks court OK of nursing school sale bidding procedures

By Caroline Salls

Pittsburgh, Oct. 4 - Saint Vincent Catholic Medical Centers requested court approval of the bidding procedures for a management agreement and purchase option agreement for its nursing schools, according to a Tuesday filing with the U.S. Bankruptcy Court for the Southern District of New York.

Specifically, Saint Vincent said it is seeking approval of bidding procedures for an auction or competitive bidding process to select the party relating to the day-to-day management of the nursing schools and approval for an option agreement that will give the successful bidder the option to buy some of the nursing school assets.

According to the motion, the regulatory process for transferring the nursing schools is long and complicated.

As a result, Saint Vincent decided the best way to handle the transaction is to first transfer day-to-day management to the potential purchaser and then transfer the nursing schools to the buyer once regulatory approval is received.

An auction to select parties interested in entering into the agreements is scheduled for Nov. 9, and the approval hearing is scheduled for Nov. 16.

Qualified bids must include a proposed capital contribution, a proposed option purchase price and a proposed asset purchase price, and each bid must include a 10% deposit of the proposed option purchase price.

A stalking horse bidder will be selected by Oct. 18.

If the stalking horse bidder is not the high bidder, Saint Vincent will pay it 3% of the total purchase price break-up fee.

The minimum initial overbid must be for at least $25,000 more than the stalking horse bid, and each subsequent bid must be for at least $25,000 more than the previous bid.

A hearing on the bidding procedures is scheduled for Oct. 11.

Saint Vincent, a New York metropolitan area health care system, filed for bankruptcy on July 5, 2005. Its Chapter 11 case number is 05-14945.

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