This struggling ultra-high-yield dividend stock may soon get some much-needed relief.

Over the past few years.Medical Properties Trust (NYSE: MPW) land in (a predicament) Sleepy. Shares of this hospital-focused real estate investment trust (REIT) have fallen more than 80% from their peak in early 2022. This decline has pushed its dividend yield into the double digits. A major factor has been the financial problems of its top two tenants, who have been unable to pay their rents in full.

This one. MEDICAL HEALTH CARE REAL ESTATE INVESTMENT TRUSTfund There may be some relief from one of the tenants. Top tenant Steward Health Care has agreed to sell its Gwen's Healthcare business to UnitedHealth (NYSE: UNH)(used form a nominal expression) Links firms Next, we look at the proposed transaction and what needs to happen for the REIT to get back on track. Let's take a look at the proposed transaction and what needs to happen for the REIT to go on the road to recovery.

Potential Repayment Catalyst

Multiple media outlets have reported that Steward Health Care has agreed to sell Stewardship Health, its primary care physician business, which employs primary care physicians and other clinical nurses in nine states, including Massachusetts, to Collaborative Care Holdings, a subsidiary of Optum, a UnitedHealth company. The company employs primary care physicians and other clinical nurses in nine states, including Massachusetts. The sale, for an undisclosed amount, will allow the company to strengthen its financial position and thus pay off some of its debt to the Healthcare Properties Trust and other creditors. The report also noted that the company hoped to sell some of its Massachusetts hospital operations.

The sale of Stewardship benefited the Maternity Care REIT. The real estate trust's management team is in the process of selling the property. Fourth Quarter Conference Callnote above The monetization of Stewardship is one of two catalysts that will allow Steward to resume paying full rent by the middle of this year. Although the REIT has no direct financial stake in the entity, it obtained a second lien on the Stewardship business last year when it provided a $60 million bridge loan to Steward. The Medical Properties Trust's management team believes the sale will allow Steward to pay off all of its current outstanding debts to the company, including deferred rent.

However, there is no guarantee that the transaction will be completed or that the value of the transaction will be sufficient to pay off Steward's debt to Medical Properties Trust. The proposed transaction has been opposed by Massachusetts legislators Elizabeth Warren and Ed Markey, who argue that the transaction would not benefit patients or healthcare professionals. In addition, the deal would give Optum a larger share of the market, considering that Optum already employs 10% doctors nationwide. If Steward is unable to sell the business to a UnitedHealth company, it may have to sell to another buyer at a lower price, which may not be enough to cover its debt to the Healthcare Properties Trust.

Looking for Options

The sale of Stewardship is one of a number of ways that Materia Medica and its top tenants are looking to work together to improve their finances. The REIT announced earlier this year that it had accelerated its divestiture strategy, signing a number of deals that brought in more than $480 million in liquidity. This is part of a plan to raise at least $2 billion in incremental liquidity this year. These sales will provide the company with cash to pay down debt as it comes due over the next few years.

This figure does not include the sale of the three Connecticut hospitals currently leased to Prospect Medical Holdings, which the company has agreed to sell to Yale New Haven Hospital in 2022. The sale, which includes Yale's acquisition of Prospect's hospital business, has not yet been approved by regulators. The REIT will receive $457 million from the sale, including $355 million in cash and $103 million in equity in Prospect's Torgue Healthcare business. Prospect is also working to monetize its Torgue Healthcare business, which will allow the REIT to recoup the value of some of its properties and deferred rents.

In addition, the REIT is working with Steward to sell or re-let some of the hospitals it leases. The sale of the facilities will provide additional liquidity to the Healthcare REIT, while the replacement of the tenants will allow the properties to regain their earnings contribution to the REIT.

Striving for Complexity

The sale of Stewardship will allow Steward to strengthen its financial position so it can catch up on its bills, including those owed to the Medi-Cal Industrial Trust. That's why the potential deal with UnitedHealth could change the rules of the game for both companies. However, that's not the only option the REIT has when it comes to restoring its investment portfolio and financial position. While there is still a long way to go, the REIT seems to be heading in the right direction.

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Matt DiLallo has a position in Medical Properties Trust.The Motley Fool recommends UnitedHealth Group.The Motley Fool has a disclosure policy.

This Struggling Ultra-High-Yield Stock May Soon Get Some Much-Needed Relief was originally published by The Motley Fool.