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This audio is auto-generated. Please let us know if you have feedback<\/a>.<\/p>\n Dive Brief:<\/p>\n Dive Insight:<\/p>\n ReGen\u2019s deal to acquire Genesis is a \u201cstalking horse bid,\u201d which sets the floor price <\/strong>to buy Genesis in the event of an auction.<\/p>\n The private equity firm has invested in Genesis before, when it was on the verge of filing for bankruptcy for the second time in 2021, according to court documents. The operator had filed for Chapter 11 before in 2000 and emerged from restructuring in 2001.<\/p>\n ReGen\u2019s initial $50 million investment in 2021, paired with a lease restructuring agreement with Genesis\u2019 largest landlord, allowed the operator to \u201cnarrowly\u201d avoid a bankruptcy filing, according to court documents. The private equity firm continued to invest in Genesis, and its investment totaled about $100 million.<\/p>\n However, liabilities related to past expansions, <\/strong>\u201cyears of financial stress and deferred capital expenditures,\u201d pressures from the COVID-19 pandemic and inadequate Medicaid reimbursement prompted Genesis to file for Chapter 11 protections again on Wednesday.<\/p>\n \u201cAll told, while ReGen\u2019s cumulative investment of approximately $100 million (over approximately two years) allowed the Company to avoid bankruptcy and provided a liquidity runway to a business struggling with legacy liabilities and other business challenges, it was unfortunately insufficient to allow the Company to fully transform its business model and achieve long-term viability,\u201d Louis Robichaux IV, co-chief restructuring officer, wrote in court documents Thursday.<\/p>\n In initial filings, Genesis said it has up to 25,000 creditors, with liabilities between $1 billion to $10 billion<\/a>.<\/p>\n Genesis has faced other financial challenges in the past, including a nearly $54 million\u00a0<\/strong>fine in 2017<\/a> from the government to settle allegations it violated the False Claims Act for submitting \u201cmedically unnecessary therapy and hospice services, and grossly substandard nursing care.\u201d<\/p>\n Genesis joins a growing number of notable bankruptcies this year. In January, health system Prospect Medical Holdings filed for Chapter 11 protections<\/a>. Last year, both medical center operator CareMax<\/a> and hospital operator Steward Health Care filed for bankruptcy<\/a>.<\/p>\n\n