A bankruptcy court has approved the acquisition of the assets of bankrupt LCI Holdco LLC, the parent of LifeCare Holdings Inc., by Hospital Acquisition LLC, Reuters reported today. The Internal Revenue Service had argued that the sale should be blocked because it would generate a big capital gains tax burden and leave LCI Holding Company Inc., based in Plano, Texas, without cash to pay it. LCI, struggling with $484 million in debt, filed for bankruptcy on December 11. The company hired Rothschild investment bank to sell its assets and LCI's lenders were the only bidders for the facilities, which have a total of 1,400 beds spread over 10 states. The lenders, who are owed $353 million, proposed swapping most of their debt and taking on some of LifeCare's obligations in return for ownership.
