Tower Health rejects 4th purchase offer; 'I'm not sure what they're thinking,' StoneBridge CEO says

West Reading, Pa.-based Tower Health has turned down a $706 million offer from StoneBridge Healthcare, a hospital turnaround firm, making this the fourth purchase offer rejected by the system since 2021. 

StoneBridge received an email from Andrew Turnbull, a managing director at Houlihan Lokey, an investment bank that works with Tower Health, saying that there had been a board meeting and the firm's offer had been rejected, Joshua Nemzoff, CEO of StoneBridge Healthcare, told Becker's.

"I'm not sure what they're thinking. We have requested multiple board meetings, but we've never had a chance to meet with the board. We've just gotten emails back saying they're rejecting the offer," Mr. Nemzoff said.

WoodBridge, a nonprofit sister organization to StoneBridge, initially shared a nonbinding agreement in principle with Tower Health, which included the intent to purchase the system's assets.

"We've given them a number of other offers. I think the last one was more than a year ago. They've lost $400 million in operations in the last two years, and they're $1.8 billion in revenue and $1.5 billion in debt, and 30 days of cash," Mr. Nemzoff told Becker's

Tower Health initially turned down a $675 million offer from StoneBridge in November 2022. In partnership with Allentown, Pa.-based Lehigh Valley Health Network, the firm also made two conditional offers to acquire the system's assets for $600 million in 2021, which were also rejected. 

"Given their cash position and given their extraordinary amount of debt, I think our plan is just to frankly to wait for them to go bankrupt and show up in court for the auction. I think that's going to happen next year," Mr. Nemzoff said. 

StoneBridge was formed in 2020. The firm currently does not own or operate any hospitals. Like StoneBridge, WoodBridge has also not completed any hospital deals, Mr. Nemzoff told Becker's

Tower Health told Becker's that they do not comment on unsolicited proposals. 

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Whitepapers

Featured Webinars