Tower Health hires new investment bank in latest effort to recover from deep financial losses

Tower Health announced Monday that it had hired Houlihan Lokey, an investment bank known for helping organizations deal with unaffordable debt loads.

The nonprofit health system based in West Reading also said it had appointed Mike Eesley chief financial officer, replacing a series of outside consultants who had been filling that job since February 2021, when Gary Connor resigned.

Eesley has been with Tower since November 2021 as chief transformation officer.

Tower said that Houlihan Lokey, which until recently worked for Tower bondholders owed $1.3 billion, would work with Eesley on ways to “strengthen the system’s financial structure.”

Houlihan Lokey, based in Los Angeles, replaced H2C Securities Inc., which helped Tower buy five hospitals from Community Health Systems Inc. in 2017 for $423 million and during the last two years has been trying to help Tower sell some of those hospitals and other businesses.

Tower most recently sold Chestnut Hill Hospital for $28 million to a consortium led by Temple University Health System. That sale was completed Jan. 1. It’s not clear how much cash after expenses that sale generated for Tower, which has extraordinarily low levels of cash for a health-care provider of its size.

Last summer, Tower sold the shuttered Jennersville Hospital in Penn Township, Chester County, for $8 million to ChristianaCare. Tower has not found a buyer for Brandywine Hospital, which is near Coatesville and closed a year ago. Tower is still trying to sell 17 urgent care centers that are outside its core market.

Tower’s efforts to recover financially included laying off 55 people from its corporate staff of about 400 people in November. Those cuts, designed to reflect a reduction in the number of hospitals owned by Tower, were expected to save $15 million annually.

Tower is expected to report financial results near the end of February for the three months ending Dec. 31.