Why Medical Properties Trust Stock Is Tanking Today
Shares of Medical Properties Trust (NYSE: MPW) tumbled by more than 12% by 11:45 a.m. ET on Friday. Weighing on the healthcare real estate investment trust's (REIT's) stock price was a report that a California regulator put its deal to help Prospect Medical Holdings on hold.
Medical Properties Trust unveiled a comprehensive recapitalization transaction with Prospect Medical in May. The deal restructured their relationship, giving the company a meaningful equity interest in Prospect's managed care business in exchange for accrued rent and its ownership of some hospital properties in Pennsylvania.
The agreement would enable Medical Properties to eventually recoup this value by selling its stake in the managed care business. The REIT would also start collecting some rental income from hospitals leased to Prospect in September, with full rental payments scheduled for next March.
Source Fool.com
