Memorial Regional Health’s BOT votes to extend LOI with SCL Health
Following a 30-day request from SCL Health, LLC to extend its Letter of Intent window, Memorial Regional Health’s Board of Trustees voted to approve the extension, pushing the LOI deadline into late April.
The previous LOI deadline between SCL Health and MRH was slated for the end of March. MRH’s BOT voted unanimously to extend the LOI window with SCL Health at the Feb. 20 board meeting.
Shortly after the extension agreement, an asset valuation company was in town to tour MRH’s facilities and conduct real-estate appraisals. MRH hired an outside company to conduct it’s own real-estate appraisals of property, allowing the company to see what the numbers came to from two independent parties, giving MRH a greater understanding of value should they head into negotiations with SCL Health.
According to MRH CEO Andy Daniels, while MRH is on track to meet the document requests from SCL Health, the Broomfield-based organization asked for an extension to allow them to continue working through documents while gathering a better understanding of MRH’s financial situation.
Trustee Todd Jourgensen questioned the extension at first, asking what would happen should MRH not approve the extension.
Daniels told the board that should MRH not approve the extension, it would possibly result in SCL Health walking away from the due diligence period. However, with the extension, it gives SCL Health more time to come to a decision.
“I have heard from members with SCL Health that they should be able to come to a decision by March 27,” Daniels told the board. “Obviously, that’s after the deadline we originally agreed to, so this would allow them to take additional time, work through some additional documents, and then come to a decision.”
Daniels added that there’s still a possibility that even with the extension, SCL Health could still walk away from the negotiations.
Through the original Letter of Intent agreement between the two parties, SCL Health could acquire the operations and purchase and/or lease the assets of Memorial Regional Health on mutually agreed upon terms, should they move forward with MRH. Those assets include the hospital, affiliated clinics and land.
SCL Health and Memorial Regional Health have a history of partnership. SCL Health’s St. Mary’s Medical Center in Grand Junction and Memorial Regional Health announced a care affiliation agreement in 2018, and announced in early 2019 that MRH took an ownership position in CareFlight, an air medical transport service operated by St. Mary’s.
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