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L&M's 'stalking horse' bid accepted

By Judy Benson

Publication: theday.com

Published June 13. 2012 5:00PM   Updated June 14. 2012 12:01AM

Lawrence & Memorial Hospital's "stalking horse" bid to purchase The Westerly Hospital received a Rhode Island Superior Court judge's approval on Wednesday.

The bid, proposed in a petition to Judge Brian Stern from Attorney Mark Russo, the court-appointed special master for Westerly Hospital's receivership case, will now serve as the benchmark against which rival bids will be considered. Other potential buyers have until July 30 to submit a competing proposal to purchase the financially troubled hospital.

Russo on Wednesday declined to comment other than to confirm that the judge had granted his bid petition.

Mike O'Farrell, spokesman for L&M, said no objections were raised during the hearing.

"We now continue our process of due diligence," he said.

The New London-based nonprofit hospital has proposed acquiring The Westerly Hospital for $69 million in financial and other assets. Hospital officials have characterized it as both a growth opportunity and a defensive strategy to keep for-profit hospital management companies out of its patient service area. Westerly Hospital Holdco, an affiliate of a New Jersey-based for-profit hospital management company, is among health care firms that previously expressed interest in purchasing The Westerly Hospital.

During a previous interview, Russo said he expected that a sales hearing would take place in mid-August, with a closing in January. Health care regulators in both Rhode Island and Connecticut would have to give final approval of the sale.

j.benson@theday.com

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