IHC Sets Sept. 15 Sale Hearing as Committee Fights Bid Protections Across Stalking Horse Portfolio
The Official Committee of Unsecured Creditors in Inspired Healthcare Capital Holdings’ Chapter 11 case is contesting the break-up fees and expense reimbursements attached to 11 stalking horse deals, arguing the debtors have proposed paying buyers even when the buyer itself, rather than a competing bid, causes a sale to fall through. The fight, which has been building since late July, now extends to the most recently disclosed deal in the case: a $143.5 million sale of five senior living communities to National Healthcare Properties Operating Partnership, L.P.
The committee first raised the issue in an omnibus objection filed July 30, challenging the proposed bid protections tied to 10 stalking horse designations filed up to that point. On Aug. 11, the committee – represented by Greenberg Traurig – filed a follow-on objection applying the same arguments to the National Healthcare Properties, or NHP, deal, which the debtors designated Aug. 4.
The committee’s core argument is that bid protections should be payable only when they benefit the estate: when a higher and better competing bid actually closes. But the asset purchase agreements let buyers collect a break-up fee, an expense reimbursement, or both in several other circumstances, according to the committee’s filing: if the bankruptcy case is dismissed or converted, if the buyer itself breaches the agreement or fails to close by the agreed deadline, if the debtors terminate the agreement to satisfy their fiduciary duties, or if a government ruling blocks the deal. The committee said the estate should not be liable for those payments, particularly where the buyer’s own default caused the termination, and has asked the court to limit the triggering conditions to the closing of a superior competing transaction.
The committee also disputes the validity of the seven-day objection deadline the debtors set for each stalking horse designation, arguing it was not established by the bid procedures order or any other court order. The committee said it filed its NHP objection “out of an abundance of caution” without conceding the deadline is enforceable, and reserved its right to raise the same arguments at future sale hearings.
NHP’s $143.5 Million Deal
Under the terms disclosed in the Aug. 4 designation notice, NHP would acquire The Residence at Cedar Dell in Dartmouth, Mass.; Candle Light Cove in Easton, Md.; The Blake at New Braunfels in New Braunfels, Texas; Mariella of Sage Spring in San Marcos, Texas; and Mariella of Teravista in Round Rock, Texas, for an aggregate purchase price of $143.5 million, payable in NHP operating partnership units, real estate investment trust shares, and cash – with the cash portion capped at $65 million. The structure sets the deal apart from the case’s other stalking horse transactions, which are cash purchases. NHP, formerly the AR Global-sponsored nontraded REIT Healthcare Trust Inc., listed on the Nasdaq in April.
The proposed bid protections for NHP consist of an approximately $4.3 million break-up fee, equal to 3% of the purchase price, and an expense reimbursement of up to $494,800, both allocated on a per-community basis. The committee’s filing identifies one distinction: unlike the prior stalking horse designations, the NHP agreement does not appear to grant NHP a super-priority administrative expense claim for its bid protections.
Sale Schedule Reset to Sept. 15
The stalking horse fight is unfolding as the case’s sale schedule has been reset. A corrected amended notice from the debtors set a bid deadline of Aug. 20, a credit bid deadline of Aug. 21, an auction beginning Aug. 25, and a sale hearing on Sept. 15. The debtors noticed the Sept. 15 sale hearing on Aug. 10 along with hearings on bid protection objections and sale objections generally, the mechanism through which the committee’s objections will be heard.
Ten Stalking Horse Deals Get Priced
Separately, the debtors filed 10 fully executed asset purchase agreements on Aug. 10, disclosing exact purchase prices for stalking horse deals for the first time. Seven of the 10 confirm pricing for buyers already reflected in the roughly $538.85 million previously reported at the designation stage: AG2 Acquisitions LLC, AREP HC Fund III Investments LLC, Sonida Acquisition LLC, PHosh LLC (which appears on two separate deals), PO Holdco LLC, and Inspired Florida Acquisitions LLC. Three buyers had not previously been reported: NHP; SYMPO 2026 LLC, which is acquiring Mariella of Lake Orion and Salterra at Chesterfield in Michigan for $9.1 million; and Alliance Capital Partners LLC, which is acquiring Salterra at Ashbrook in Villa Rica, Ga., for $5.6 million. Combined with NHP’s $143.5 million deal, the three previously unreported buyers add roughly $158.2 million in newly disclosed value, bringing the case’s total disclosed stalking horse value, by AltsWire’s tally, to approximately $697 million.
IHC filed for Chapter 11 protection on Feb. 2, listing estimated liabilities of between $1 billion and $10 billion across an Arizona-based senior housing platform with approximately 35 communities in 14 states and more than 160 affiliated debtor entities, including 31 Delaware statutory trusts. The filing followed the July 2025 suspension of investor distributions amid an active SEC investigation and the shutdown of IHC’s in-house operating arm, Volante Senior Living.
The case has also drawn scrutiny over its treatment of pending Financial Industry Regulatory Authority arbitrations against IHC’s broker-dealer network; FINRA broadened its own administrative stay beyond the scope of the bankruptcy court’s injunction earlier this month. Debtors’ counsel is McDermott Will & Schulte LLP; the creditors committee is represented by Greenberg Traurig, and DLA Piper serves as conflicts counsel to the DST debtors. Epiq Corporate Restructuring serves as claims and noticing agent.
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