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December 4, 2018 – Senior Care Centers and 120 affiliated Debtors (together, “Senior Care”) or the “Company”) filed for Chapter 11 protection with the U.S. Bankruptcy Court in the Northern District of Texas, lead case number 18-33967 [Docket No.1]. The Company, a Dallas-based, skilled nursing and long-term care industry leader in Texas and Louisiana, is represented by Trey A. Monsour of Polsinelli PC. Further board-authorized engagements include Gray Robinson as counsel, Hunton Andrews Kurth as conflicts counsel and BDO USA, LLP as financial advisers. Senior Care’s petition notes between 1,000 and 5,000 creditors; estimated assets between $100 million and $500 million; and estimated liabilities between $100 million and $500 million. Documents filed with the Court list the Company’s three largest unsecured creditors as (i) Sabra Health Care Reit, Inc. ($31,785,032.13 rent claim), (ii) Healthcare Services Group Inc. ($7,963,956.84 HSG claim) and (iii) Omnicare, Inc. ($7,040,541.07 pharmacy claim).
In a press release announcing the filing, the Company detailed some of the factors contributing to their need to seek bankruptcy protection, notably the burden of expensive leases. The press release states, “Senior Care Centers, like similar companies across the country, has faced a variety of financial challenges of late, including dealing with significant cuts in reimbursements from government agencies and private insurers while facing ballooning rent payments. That care-centered reality is a vital component of Senior Care Centers’ ongoing efforts. Commenting on the filing, Michael Beal, the Company’s Chief Operating Officer, commented, “As the entire industry has seen, the leases associated with the communities have become cost-prohibitive.”
The press release continues, “The goal of the plan is to best position each of the Company’s more than 100 skilled nursing and senior living communities to continue caring for residents while the Company works to transition certain communities to new operators. The Company is currently evaluating each of the communities and working with the individual landlords to determine the best path forward for each location.”
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