CareMax Inc., a Miami-based medical services company, filed for Chapter 11 bankruptcy protection in Texas on Sunday, listing $422.6 million in funded debt and announcing plans to sell key assets during the restructuring process.
CareMax Seeks Asset Sales Amid Financial Struggles
In its bankruptcy filing, CareMax disclosed it has $693 million in total liabilities against $390 million in assets. The company has struck a deal to sell part of its management services business to an affiliate of Revere Medical. Additionally, a third party has emerged as a “stalking horse” bidder for CareMax’s operating clinic business, setting a minimum offer to encourage competitive bids.
CareMax Files For Chapter 11 Bankruptcy : Chapter 11 Backed by Senior Lenders
CareMax has secured the support of its senior lenders, who have agreed to provide $30.5 million in debtor-in-possession (DIP) financing to ensure the company can continue operations throughout the bankruptcy proceedings. If a final agreement with the stalking horse bidder is not reached, these secured investors are prepared to submit a credit bid for the clinic business, the company said.
Rising Costs and Debt-Fueled Expansion Led to Bankruptcy
Founded in 2011, CareMax operates 46 medical centers, employing approximately 1,100 staff who primarily serve elderly patients. The company’s rapid expansion was partly fueled by its 2021 public debut through a merger with a special purpose acquisition company (SPAC) sponsored by an affiliate of Deerfield Management Company LP. Following this, CareMax made a series of acquisitions, including a $135 million deal to purchase Steward Health Care’s Medicare value-based care business.
