A New York-based investment firm, bought Rural/Metro in July 2011 for about $676.5 million, including $236.3 million in debt, so is debt such a good investment anymore one might ask? The corporate offices are located in Scottsdale, Arizona. The company also provides fire fighting services in many communities across the US and for big companies such as FedEx and other industrial types of companies.
The company is also looking at borrowing $40 million to help get them over the Chapter 11 hump. Billing and collection problems were slated as one of the big issues. Investors and banks that hold $308 million in notes will swap them for all of the company's equity. How many more will there be in healthcare? BD
(Reuters) - Ambulance operator Rural/Metro Corp, owned by private equity firm Warburg Pincus, filed for Chapter 11 bankruptcy with the aim of cutting its debts after it missed an interest payment in July, according to court filings.
The Scottsdale, Arizona-based company also intends to renegotiate unprofitable contracts and free up capital for investments through the bankruptcy process, according to the filings.
The provider of private ambulance and fire protection services declared liabilities and assets each worth more than $500 million.
Rural/Metro reached an agreement with both its senior secured and unsecured debt holders to reduce its debt and interest payments by nearly 50 percent. In 2011, affiliates of Warburg Pincus bought Rural/Metro for about $438 million in an all-cash deal excluding debt.