Nu-Med Set to Reorganize Into 2 Separate Companies

Nu-Med Inc., an Encino hospital operator that filed for Chapter 11 bankruptcy reorganization in January, said it plans to reorganize into two separate companies.

PsychGroup Inc., now a Nu-Med subsidiary that operates psychiatric hospitals, will be 95% owned by Nu-Med’s creditors and bondholders. The remainder will be owned by Nu-Med’s current preferred and common stockholders.

A new Nu-Med entity will also be formed and will own the company’s troubled acute-care hospital assets. Stock in the reorganized Nu-Med will be distributed to creditors and preferred stockholders. Nu-Med’s common stockholders will also receive a total of $50,000 cash.

Nu-Med said the reorganization plan was based on agreements reached with its creditors’ committee. A federal bankruptcy court hearing on the accompanying disclosure statement is set for Nov. 17, and Nu-Med expects a hearing on the reorganization plan to be held in mid-January.