Southern Regional Health Systems

Situation

Southern  Regional Health Systems, Inc. (SRHS) is a community hospital serving the citizens of Clayton County in Georgia.  Like many community hospitals in the United States, SRHS had run into several years of financial deficits due to a high level of indigent care, poor payer mix, and more profitable procedures going to other facilities.  Despite additional capital infusions and restructuring efforts by other professionals, by mid 2015, SRHS was left with no other option but to file for Chapter 11 Bankruptcy protection in the hopes of being able to sell the hospital as a going concern..

Action

In July 2015, SRHS engaged GGG to be its financial advisors through its Chapter 11 filing.  Prior to the filing GGG had to quickly:

  • Create a working cash flow to determine the cash requirements through the initial phases of the filing and then track against that throughout the process.
  • Gather and compile all the data necessary for the bankruptcy filings.
  • Negotiate with vendors to keep the products and services the hospital needed to operate.
  • Provide expert testimony during the bankruptcy proceedings and manage the Official Committee for the Creditors..

Results

After working with SRHS the company:

  •  Stay open with substantially all of its pre filing services
  • Helped secure and manage DIP financing through the process
  • Assist with trying to identify additional qualified buyers for the hospital
  • Worked closely with the Debtor and Debtor Professionals to successfully sell substantially all the assets of the hospital through a 363 Sale Process
  • Paid all of its administrative claims within the DIP financing limits provided
  • Met all filing requirements in a timely manner
  • Successfully replaced senior management
  •  Right sized the organization for future success

Thanks to the support of the purchaser, DIP financier, Legal team and the hard work and dedication of the management and employees, SRHS has emerged from bankruptcy as a strong, viable entity.

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