Microsoft Word - Prospect AG letter - CA.docx

The Private Equity Stakeholder Project argues that Leonard Green & Partners extracted $658 million in fees and dividends from Prospect Medical Holdings despite the hospital chain's declining financial health, poor quality ratings, and unfunded pension liabilities. The letter highlights a $457 million dividend paid in 2018 that allegedly contradicted commitments made to Rhode Island regulators. It also notes that Prospect sold hospital real estate to Medical Properties Trust to pay down $1.1 billion in debt and shut down all facilities in Texas. The author requests that California's Attorney General withhold approval for the ownership transfer to ensure resources are available for the COVID-19 response.

• Since 2010, Leonard Green & Partners and other minority owners extracted approximately $658 million in fees and debt-funded dividends from Prospect Medical Holdings, despite the company facing operating challenges and regulatory scrutiny.
• Prospect Medical Holdings' financial performance declined significantly between 2015 and 2018, with EBITDA falling from $142 million to $17 million and the EBITDA margin dropping from 10.8% to 0.6%. Additionally, the company had $260 million in unfunded pension liabilities as of September 2018.
• In 2018, the Leonard Green-led investment group collected a $457 million dividend, which the author claims contradicted a 2014 assurance to the Rhode Island Office of the Attorney General and State Department of Health that no additional dividend distributions were intended.
• To address $1.1 billion in debt used partly for dividends, Prospect sold hospital real estate to Medical Properties Trust and leased it back; subsequently, Prospect closed all its health care facilities in Texas and laid off nearly 1,000 employees.

APA

O’Grady, E. (2020). Microsoft Word - Prospect AG letter - CA.docx. Private Equity Stakeholder Project. https://pestakeholder.org/wp-content/uploads/2020/06/Letter-to-CA-AG-Becerra-re-PMH-5-26-20.pdf

Chicago

O’Grady, Eileen. Microsoft Word - Prospect AG letter - CA.docx. Private Equity Stakeholder Project, 2020. https://pestakeholder.org/wp-content/uploads/2020/06/Letter-to-CA-AG-Becerra-re-PMH-5-26-20.pdf.

Wikipedia

{{cite press release |last1=O’Grady |first1=Eileen |title=Microsoft Word - Prospect AG letter - CA.docx |publisher=Private Equity Stakeholder Project |date=26 May 2020 |url=https://pestakeholder.org/wp-content/uploads/2020/06/Letter-to-CA-AG-Becerra-re-PMH-5-26-20.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{ogrady2020microsoft, author = {O’Grady, Eileen}, title = {{Microsoft Word - Prospect AG letter - CA.docx}}, publisher = {Private Equity Stakeholder Project}, year = {2020}, month = may, url = {https://pestakeholder.org/wp-content/uploads/2020/06/Letter-to-CA-AG-Becerra-re-PMH-5-26-20.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }