Yale New Haven Health Services Corp. has agreed to allocate $411.5 million to potentially satisfy a judgment in its ongoing legal battle over a failed $435 million acquisition of three Connecticut facilities from Prospect Medical Holdings Inc., as stated in a stipulation from the involved parties.
Agreement to Set Aside $411.5 Million
Yale New Haven Health and the California-based Prospect Medical, which is suing for an alleged breach of the asset purchase agreement, agreed that setting aside the $411.5 million would render Prospect Medical’s request for a prejudgment remedy moot. This agreement was filed on Friday in Connecticut Superior Court. The funds were set aside partially because the court confirmed it could expedite the proceedings and hold a trial in December.
Disputed Asset Purchase Agreement
Although the asset purchase agreement was for $435 million, the parties stipulated that $411.5 million would suffice to meet Yale New Haven Health’s obligations if the court mandates the deal. The stipulation notes, “The base purchase price under the [asset purchase agreement] of $435 million is subject to certain adjustments at closing subject to the terms of the APA. While the parties dispute certain of those adjustments, it is agreed that such adjustments will reduce the total consideration paid at closing by at least $23.5 million.”
