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Bankruptcy update: Medical Staffing Network

July 08 2010

Medical Staffing Network Holdings (OTCBB: MSNW.PK), which filed for Chapter 11 bankruptcy protection last week, announced it received interim approvals to continue using an escrow account for its VMS payments and to continue serving its government prime contract accounts.

Medical Staffing Network announced an escrow account in May as part of an effort to calm fears of vendor management system clients and subcontractors after it warned about a possible bankruptcy filing. It is using CBIZ Goldstein Lewin as its escrow agent.

It also reported the court on July 7 granted interim approvals for the company to continue paying employees, sign up for debtor-in-possession financing of up to $15 million and to file to deregister its common stock.

Final approval of the actions will be considered by the bankruptcy court on July 21.

Medical Staffing Network's bankruptcy filing is part of a plan that calls for selling the company to its first-lien lenders for $84.1 million -- although the court will consider other bids as well.

The company set up a Web site detailing the Chapter 11 filing and sale process at http://www.msnreorg.com/.

Boca Raton FL-based Medical Staffing Network ranks as one of the largest U.S. healthcare staffing firms.

To read the original story on the bankruptcy filing, click here.

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