Rennova board member resigns, seeks to take over company

An investor and former member of West Palm Beach, Fla.-based Rennova Health's board is negotiating to take over the hospital operator, according to WBIR, which cited filings with the Securities and Exchange Commission.

Christopher Eric Diamantis was one of four members of Rennova's board of directors before resigning Feb. 26. Over the past year and a half, Mr. Diamantis guaranteed loans and lent Rennova millions for major purchases. He would cancel the $22.3 million Rennova owes him in exchange for a controlling share of the company, according to the report.

Seamus Lagan, who serves as Rennova's CEO and CFO and has a controlling interest in the company, said the board supports the deal with Mr. Diamantis.

"Although no assurance can be given that such an agreement will be entered into, the board of directors of the company believes it would be in the best interests of the company and its stockholders and has authorized the exchange, subject to final documentation," states a financial filing cited by WBIR.  

During the past year, Rennova's hospitals have experienced payroll delays and critically low supplies. Rennova closed its hospital in Jamestown, Tenn., in June. The 85-bed hospital abruptly shut down just one day after its Medicare and Medicaid funding was cut off.

Sen. Marsha Blackburn, R-Tenn., sent a letter to Rennova in late January seeking information about the financial situation of its hospitals. In his response, Mr. Lagan said he's working on securing capital for Rennova and its hospitals. He noted that the closure of the hospital in Jamestown created a "significant disruption" to Rennova's business strategy.

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