Genesis Healthcare won bankruptcy court approval Thursday to amend its roughly $1 billion asset sale to 101 W. State Street, resolving last-minute disputes that threatened to cut $100 million from the purchase price.
Judge Stacey Jernigan of the U.S. Bankruptcy Court in Dallas approved the amended terms, under which the price remains at nearly $1 billion while the net cash payment to Genesis increases by about $15 million.
The approval paves the way for Genesis to close the sale Friday and proceed to a plan confirmation next week.
As part of the amendments, the nursing-home operator agreed to reduce the $97 million promissory note by $7.5 million. Genesis also exercised its option to buy out a $30 million master lease on 22 facilities in Pennsylvania, allowing 101 W. State Street to assume direct leases on those profitable facilities.
In exchange, 101 W. State Street, an affiliate of California-based nursing-home operator and medical consulting firm New Generation Health, or NewGen, has agreed to pay $17.3 million in cash and provide a short-term note valued at between $18 million to $19 million.
"As a result of the amendment, while there were certain concessions and reductions in the promissory notes, the debtors received significant economic benefits," said Gregg Galardi, a lawyer for Genesis, during the hearing.
The deal followed a 40-hour marathon negotiation, according to Andrew Turnbull, a financial adviser to the official committee of unsecured creditors.
Andy Dietderich, a lawyer representing Genesis controlling investors Joel Landau and co-investor David Gefner who had previously expressed concern over the deal, confirmed they were on board. "We have no objection," Dietderich said, congratulating the parties on reaching terms.
Genesis filed for bankruptcy in July 2025, citing mounting legacy litigation tied to allegedly substandard care at its facilities.
In an earlier auction, Genesis had picked a winner tied to Landau, an insider who had controlled the company since 2021. The bid collapsed after Judge Jernigan declined to sign off on liability releases for Genesis insiders.