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Published: Wednesday, 4/20/2011 - Updated: 3 years ago

MedCorp suitor pledges to keep firm in Toledo

New York equity fund bids $12.5M for ambulance service

BY SHEENA HARRISON
BLADE BUSINESS WRITER
MedCorp President Richard Bage heads out of the courtroom during a recess during a hearing to decide whether to sell the assets of MedCorp ambulance company to a New York private equity firm. MedCorp President Richard Bage heads out of the courtroom during a recess during a hearing to decide whether to sell the assets of MedCorp ambulance company to a New York private equity firm.
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Parties in the MedCorp Inc. receivership case will return to court next week to hear whether the Toledo ambulance company will be sold to a New York City equity fund.

An all-day hearing regarding MedCorp's possible sale and other matters was held yesterday before Lucas County Common Pleas Judge Gary Cook. A court-appointed receiver has asked Judge Cook to approve the sale of MedCorp's assets to Enhanced Equity Fund LP.

Judge Cook scheduled a hearing for 10 a.m. April 29 to continue hearing arguments in the case.

If the sale is granted, filings show that Enhanced Equity plans to consolidate MedCorp with ambulance company FirstMed Inc. in Virginia and North Carolina.

John McHugh III, an attorney for MedCorp co-founder Richard Bage, accused Enhanced Equity of wanting to move MedCorp's operations to Columbus.

Christopher Garcia, a partner with Enhanced Equity, said the fund plans to maintain MedCorp's presence in northwest Ohio. "We have no intentions on moving the company," he said. "We have every intention of being here in Toledo."

MedCorp has 720 employees at 22 facilities in Ohio. More than 200 MedCorp employees work in Toledo, including at its headquarters at 745 MedCorp Drive.

Receiver Mark Uhrich of Hill- yer Group LLC said that he received three bids in January for MedCorp's assets. Enhanced Equity's bid totaled $12.5 million, while Community Emergency Medical Service of Southfield, Mich., submitted a bid worth $10.9 million to $12.6 million.

Mr. Bage submitted a bid worth $9.2 million, Mr. Uhrich said. The receiver favored Enhanced Equity's bid because he said it "had the highest economic value for the creditors" and included "large portions of cash at closing" compared to the other offers.

Court filings show Enhanced Equity plans to pay $5.25 million in cash at closing.

Mark Uhrich, Medcorp. Inc.'s court-appointed receiver, listens to proceedings at the hearing in Lucas County Common Pleas Court. Mark Uhrich, Medcorp. Inc.'s court-appointed receiver, listens to proceedings at the hearing in Lucas County Common Pleas Court.
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Mr. Bage lost his job with MedCorp after Mr. Uhrich was appointed in August as a receiver for MedCorp's assets and business affairs.

Huntington National Bank requested Mr. Uhrich's appointment after MedCorp defaulted on two loans worth $10 million. The court issued a "cognovit" judgment in favor of Huntington in August, which was reduced to $9.6 million in February.

Mr. McHugh argued that Mr. Uhrich did not fairly assess the value of his client's bid and said Mr. Bage should have been allowed to submit a counteroffer to Enhanced Equity's bid.

"The man built the business," Mr. McHugh said. "He at least ought to have the opportunity to save it."

Judge Cook countered that Mr. Bage had a chance to turn the business around before it entered receivership. "The opportunity to save it has been given and has passed," Judge Cook said.

Mr. McHugh also alleged that favoritism was shown toward Enhanced Equity's bid. A purchase agreement from Enhanced Equity, submitted in court filings, says Huntington would reimburse up to $400,000 of Enhanced Equity's "documented out-of-pocket expenses" for the planned acquisition if it falls through.

Mr. Uhrich said Enhanced Equity's bid could depend, in part, on a lease deal to keep MedCorp in its headquarters for three months or longer. The building is owned by Stickney Avenue Investment Properties LLC, another company founded by Richard and Laurie Bage of Maumee that has been under receivership since February.

Contact Sheena Harrison at: sharrison@theblade.com or 419-724-6103.



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