Grudziadz Municipal Holding is to help improve the financial situation of a record-breakingly indebted hospital. Ultimately, the Bieganski Regional Specialist Hospital in Grudziadz may be transformed into a commercial law company. According to the city authorities, the proposed solution is a pioneering one in Poland.
Grudziadz Municipal Holding as a “hybrid” to raise funds
The Biegański Regional Specialist Hospital in Grudziądz is drowning in debt. Its debt currently amounts to over PLN 450m. The mayor of the city recently presented a bold plan to save the facility. As reported by Gazeta Pomorska, he proposed the establishment of Grudziadz Municipal Holding (GHK), whose sole owner will be the Municipality of Grudziadz. The Holding will take over partial shares in five municipal companies, for which it will obtain a loan of PLN 240m.
Additional PLN 60m is to be obtained from the sale of a minority stake in Municipal Waterworks and Wastewater Treatment Plant. The funds are to be paid by a private investor, but with a guarantee that the city will buy back the shares. This will reduce the hospital’s debt to PLN 151m. At the same time, the debt will be repaid by the city through a subsidiary. Therefore, the city is considering various options of acquiring additional funds, including the sale of real estate.
The hospital will be transformed into a company
Ultimately, the hospital is to be transformed into a capital company. It is planned to issue new shares, which could be acquired by the marshal of the province and other local governments. According to the city authorities, quoted by Puls Biznesu, 60% of the hospital’s patients are living outside the city of Grudziadz. Therefore, they want local governments, whose residents are the beneficiaries of the hospital, to become more involved in its functioning. At the same time, it is worth noting that the possible transformation will not be privatisation, and similar companies operate in other provinces.
According to the schedule presented by the newspaper, Grudziadz Municipal Holding could be established already in July. In September, the sale of shares in Municipal Waterworks and Wastewater Treatment Plant may be finalised. In October and November, the city wants to finalise obtaining a loan and transforming the hospital into a company. This means that the whole process may be completed in 2019.
According to PMR data, the hospital in Grudziadz is one of the 10 largest hospitals in Poland. In total, it has over 1,000 beds.