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Bankrupt hospital chain selling to its creditors

The Associated Press

PLANO, Texas (AP) -- The parent company of hospital operator LifeCare Holdings Inc., which filed for Chapter 11 bankruptcy protection in December, said Monday that it will sell most assets to a business formed by its senior secured lenders.

LCI Holdco LLC, the parent company of Plano, Texas-based LifeCare, said in a statement that it will sell "substantially all" of its assets to Hospital Acquisition LLC after no other bidders emerged during its court-supervised sale process. The deadline for bids was Wednesday.

LifeCare currently operates 27 long-term acute-care hospitals, which treat medically complex patients needing extended hospitalization, across 10 states; including Pennsylvania, Texas, Florida, Louisiana, North Carolina, Nevada, Wisconsin, Colorado, Ohio and Idaho.

The company's senior notes mature this year.

LifeCare's Dec. 11 bankruptcy protection filing stated that it had $575.9 million in debt but only $422.2 million in assets. At the time, it said it would continue to operate and pay its employees.

A hearing to approve the sale has been set for April 2, with the proposed sale expected to be finalized in the summer.

Besides court approval, consent from regulators and other customary closing conditions are required.

LifeCare's statement did not disclose any details of the deal's financial terms. A spokeswoman for the company declined to comment.