The New Jersey State Health Planning Board has recommended Ontario, Calif.-based Prime Healthcare Services be allowed to purchase bankrupt Saint Michael's Medical Center in Newark, N.J., according NJ.com.
Financially troubled Saint Michael's filed for chapter 11 bankruptcy last August. The state has been considering the sale of the hospital to Prime since December 2012, and Saint Michael's said the extended consideration of the transaction is the chief reason it filed for bankruptcy.
Prime has agreed to buy Saint Michael's for $62 million and invest $50 million to modernize the hospital. In addition, Prime has committed to keep "substantially all" of the hospital's 1,400 employees, according to the report.
With the green light from the state health planning board, the state's acting health commissioner, Cathleen D. Bennett, has 120 days to decide whether the transaction should move forward. The deal must also be approved by the attorney general and a judge.
"We still have several steps ahead of us before the sale to Prime is completed but are encouraged by this latest development and hope that Commissioner Bennett will render her decision quickly," Saint Michael's President and CEO David Ricci told NJ.com.
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