Formal sale step taken for NRMC as board files letter of intent with potential buyer
Published 12:13 am Friday, April 4, 2014
NATCHEZ — The Adams County Board of Supervisors voted Thursday to enter into a letter of intent with a potential buyer for the county-owned hospital.
The letter of intent is a non-binding but formal step in which both parties agree to continue negotiating in good faith, said Walter Brown, the attorney for Natchez Regional Medical Center’s board of trustees.
NRMC’s board chairman, the Rev. Leroy White, said a confidentiality agreement with the buyer — at the buyer’s request — keeps the hospital from disclosing who it is and the specifics of terms that are included in the letter of intent at this time.
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“They want to be at the forefront of making the announcement, and we respect that,” he said.
The letter of agreement includes some terms that have already been reached, including a purchase price, the recruiting of physicians and the safeguarding of NRMC’s employees to a limited extent, Brown said.
“The potential buyer is a highly-qualified, well-respected, well-financed hospital system,” he said.
A binding asset purchase agreement will be more specific about what is being purchased and could potentially be reached in 30 days, Brown said.
“We think this is a very positive step toward paying off the county’s debt to the Mississippi Development Bank and to paying off the hospital’s creditors,” he said.
The board of supervisors met behind closed doors to discuss the letter of intent with Brown, White and NRMC Chief Executive Officer Donny Renftro.
After the meeting, supervisors president Darryl Grennell said the vote was unanimous.
The terms of the letter of intent required acceptance before Tuesday.
Brown said the letter of intent would eventually be filed with the federal courts in connection with NRMC’s chapter 9 bankruptcy filing.
The hospital filed for bankruptcy last month in what officials said was an effort to keep the facility’s doors open after its financial liabilities exceeded its assets.
The hospital also filed for bankruptcy in 2009 and exited it that same year.
The process of selling the county-owned facility began in mid-2013, approximately six months before the hospital first announced it would seek bankruptcy relief.
NRMC opened in 1960 as Jefferson Davis Memorial Hospital. Its $2.4 million construction was underwritten by an $800,000 local contribution and state and federal funds.
It has been financially independent since 1974 and does not receive tax support, but is backed by a 5-mill standby tax that the Mississippi Development Bank required the hospital to get in 2006 when it asked for the MDB to reissue its revenue bond.
Though the hospital has an independent county-appointed board, which filed the bankruptcy, the county supervisors have the final say in the sale or lease of the facility.