CONYERS - The sale of Rockdale Medical Center to Signature Hospital Corporation has been delayed until next month because of a proposed change in the method of payment for the local hospital.
According to a letter sent Friday from the Georgia Attorney General's Office to attorneys for the RMC Inc. Board of Directors, the Rockdale County Hospital Authority and Signature, the proposed change in payment violated the terms of sale that were originally submitted in September.
The Attorney General's Office was notified Friday of Signature's proposal to pay $20 million of the total $87.7 million price in the form of a promissory note instead of cash. No reason was given for the change. Ashby Q. Burks, a Nashville attorney representing Signature in the sale, said in a letter to Lerer that the company still intends to purchase the hospital as originally agreed to. Signature had requested the change and was awaiting agreement from the Hospital Authority.
Due to that change, Ray Lerer, deputy Georgia attorney general and the hearing officer assigned to the RMC sale, told both parties they have until 5 p.m. Friday to notify him in writing of whether the sale has been modified in light of public comment, the sale has been terminated, the sale has been completed as originally submitted or if other actions are to be taken.
The county Hospital Authority and RMC board of directors have called a meeting for 5:30 p.m. Thursday in classroom 2 of the hospital's East Tower.
Because of Signature's proposal, Lerer stated in his letter that he is extending issuance of the report of findings for an additional 30 days, or until Jan. 14.
Lerer said in his letter that if both Signature and the hospital authority agree on the modification, they will need to file a supplemental notice to the Attorney General's Office. The notice will have to include a report from the hospital authority's financial consultant showing how the modification will affect the transaction and assurance that it will still result in the hospital receiving fair value for the hospital assets.
A late afternoon telephone call seeking comment Monday from Ethel Boyle, Rockdale County Hospital Authority chairwoman, was not immediately returned.
Burks was responding to Lerer's e-mail inquiry Friday morning, the day the Attorney General was required to submit a report of findings. A favorable report from the Attorney General's Office was the last hurdle for the proposed sale to go through.
Burks said Signature made the proposal Thursday. According to the proposal, the promissory note would be secured by a lien on all of Signature's assets. Repayment terms, interest rate and other details would depend on the hospital authority approving the proposal.
The change would have some effect on the sale because proceeds from the sale were expected to satisfy approximately $87 million of bond debt carried by the hospital.
The authority was also to take control of more than $55 million in cash reserves held by the hospital after the sale. It was unclear if Signature's last-minute proposal would also affect those funds.
Jay Jones can be reached at email@example.com.