Nashville, Tenn.-based Envision Healthcare confirmed plans to split with AmSurg and reorganize as it emerges from bankruptcy.
The private equity-backed physician services company filed for Chapter 11 bankruptcy in May with around $7 billion in outstanding debt.
The U.S. Bankruptcy Court for the Southern District of Texas, Houston Division confirmed Envision's plans for reorganization Oct. 11, which will eliminate 70% of the company's prepetition funded debt. Envision and AmSurg will move forward as two separate entities with separate leadership and ownership.
Envision aims to finalize the transaction in the coming weeks and emerge from Chapter 11 by the end of October.
"The Confirmed Plans allow Envision to emerge from the process in a strong position to navigate the current healthcare environment and take advantage of future opportunities to grow while continuing to deliver high quality care to patients when they need it most," said Jim Rechtin, CEO of Envision.
Jeff Snodgrass will lead AmSurg as president. AmSurg merged with Envision in 2016 to create a $10 billion healthcare services company. At the time, Envision owned 53% of the combined company and AmSurg owned 47%. As part of the bankruptcy filing, AmSurg acquired the ASCs held by Envision for $300 million plus a waiver of intercompany loans.
The surgery center chain has more than 25 centers across 34 states and nearly 2,000 physicians within its network.