HCR ManorCare amends bankruptcy plan

May 05--HCR ManorCare has filed another amended bankruptcy plan to reflect last week's decision by Toledo firms ProMedica and Welltower Inc. to purchase the skilled nursing home operator from real estate investment trust Quality Care Properties Inc.

In documents filed Wednesday in U.S. Bankruptcy Court in Wilmington, Del., Toledo-based ManorCare bid the court to take notice that under a deal struck April 25, ProMedica would now become its owner once it exits Chapter 11 bankruptcy sometime in the third quarter of the year.

It also noted that Toledo-based Welltower, one of the nation's largest real estate investment trusts, had a struck a second deal under which it will acquire Bethesda, Md.-based Quality Care Properties, also known as QCP.

As part of the deal, Welltower and ProMedica have formed a joint venture, known as Meerkat I LLC, that will own all of the property assets relating to ManorCare's business and will lease those properties back to a new ManorCare subsidiary, HCR III Healthcare LLC.

ManorCare has submitted a motion asking Judge Kevin Gross to approve the amended plan.

On March 4, ManorCare had filed a 41-page prepackaged bankruptcy plan that had been agreed upon by all the parties involved at that time -- ManorCare; its landlord, QCP, and chief investor private-equity firm The Carlyle Group.

Under that plan, the Carlyle Group would lose its equity stake, Quality Care was to own ManorCare, and former ManorCare CEO Paul Ormond, who left last fall, gets $116.7 million in previously deferred compensation.

Under the new plan, Mr. Ormond will still receive his deferred compensation.

Earlier, Judge Gross dismissed a petition by QCP that had sought to put ManorCare into receivership. It was the receivership petition that led to the bankruptcy.

The receivership petition filed last August after ManorCare defaulted on rent payments to QCP, triggering an immediate debt of $445.8 million, which were mostly in future rent payments.

Contact Jon Chavez at [email protected] or 419-724-6128.

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