Spheris workers taking vacay en masse
Posted on March 12, 2010 at 11:01 amIf they haven’t already quit, many employees of bankrupt medical transcription company Spheris have been taking their accrued vacation days, putting the company in a precarious position as it tries to hold onto customers before it is sold.
According to a motion filed in bankruptcy court yesterday, available here, Spheris’ medical transcription workers have been using their accrued paid time off at a “significantly increased rate” — about 34 percent higher than the norm since the details of its plan to be purchased by stalking horse bidders MedQuist/CBay became public.
Under the agreement, the motion states, Spheris’ buyers won’t assume its paid time off liability. So in an apparent rush to use it or lose it, many workers are taking their paid days now.
Unfortunately, that’s bad news for Spheris. Given that some employees have already left the company following its bankruptcy, having fewer of its remaining workers available to work on clients’ transcription jobs could lead to longer turnaround times, unhappy customers and lost business. Lost business could hurt the company’s chances of fetching a decent price among competing bidders.
So Spheris is asking the court to approve a plan that would let it pay employees’ accrued, unused vacation days — up to 40 hours per worker — after its acquisition has closed. As of Feb. 20, the company pegs the value of the plan at $440,000 — about 35,000 hours worth of paid time off.
But they think the aggregate payment will be “substantially less” because some employees have taken “numerous days off” since then.
permalink | Comment on this post
Spheris asks court to approve amended CHS contract
Posted on March 1, 2010 at 12:18 pmSpheris is asking a bankruptcy court judge to approve an “amended services agreement” with Community Health Systems Professional Services Corp. that extends the length of Spheris’ medical transcription contract with CHS at a better price for the Franklin-based hospital operator.
Court approval of the amended services agreement is needed before March 31, the motion states, in order for Spheris’ broader settlement agreement with CHS to remain intact.
Of course, detailed terms of the settlement and the circumstances surrounding it have remained veiled by a confidentially agreement. But the motion sheds some light on the matter — including CHS’ attempt to get its $10 million equity investment back:
permalink | Comment on this post
Court moves on Spheris case
Posted on February 24, 2010 at 8:28 amA U.S. Bankruptcy Court hearing yesterday moved forward Spheris’ bankruptcy case with the approval of the company’s pre-petition financing plan and bidding procedures for the company’s assets.
In effect, Spheris now has the green light obtain up to $15 million in debtor-in-possession financing and companies looking to compete with stalking-horse purchasers MedQuist and CBay now know the rules of the game.
The deadline for submitting bids is April 8. If competing bids are submitted, an auction will be held on April 13, and the sale hearing is set for April 15.
permalink | Comment on this post
Spheris’ creditors get more time
Posted on February 19, 2010 at 8:01 amFollowing a last-minute motion by the medical transcription company’s unsecured creditors yesterday, the hearing set for this morning to approve bid procedures for acquiring bankrupt Spheris’ assets has been cancelled.
The official committee of Spheris’ unsecured creditors yesterday asked the court to push back the hearing to allow for more time to review the bidding procedures which it said “dictates a fire sale and has other troublesome provisions.”
Late yesterday Spheris filed an objection to the committee’s request — saying “any delay, even the four day delay the committee suggests, could result in significant prejudice to the debtors and their efforts to maximize their assets for the benefit of all stakeholders.”
Among its arguments, Spheris said that its facing increasing anxiety from its customers because of the uncertainty around the sale process, and the company’s competitors are using it as an opportunity to try and steal those customers away. Having a firm process and set deadlines will help ease that anxiety and help maximize the value of Spheris’ assets, it said.
Further, it argued that proposed buyers MedQuist/CBay won’t allow Spheris to push back the sale date beyond 60 days from its Feb. 3 filing date unless the unsecured creditors consent to the current bid procedures.
Earlier in the week, creditor and competitor Nuance Communications filed an objection to the bid procedures, saying they give stalking horse bidders MedQuist/CBay an unfair advantage.
Spheris’ unsecured creditors want hearing pushed
Posted on February 18, 2010 at 1:12 pmThe official committee of Spheris’ unsecured creditors today asked the court to push back a hearing scheduled for tomorrow morning so it has more time to review the bidding procedures for bankrupt Spheris‘ assets, which it says “dictates a fire sale and has other troublesome provisions.”
Nuance Communications, a Spheris creditor, filed an objection to the bid procedures Tuesday, arguing that they give stalking horse bidders MedQuist and CBay an unfair advantage.
The committee argues that because of last week’s blizzard in the northeast, the committee was only officially formed yesterday afternoon — a mere 44 hours before the hearing and long past the objection deadline. It wants the court to delay the hearing on both the debtors in possession motion and the bid procedures motion until Tuesday morning (the 23rd) or later.
Bankruptcy can get expensive
Posted on February 16, 2010 at 11:58 amIn motions filed late last week to authorize its bankruptcy co-counsel, Spheris disclosed some hefty legal payments. Its New York City law firm, Willkie Farr & Gallagher, took home $3.3 million in the 90 days ended Feb. 3. (The firm’s attorney fees range from $290 to $995 per hour, according to the filing).
Co-counsel Young Conaway Stargatt & Taylor, out of Delaware, was retained on Oct. 15. The firm was put on a $75,000 retainer on Dec. 10 and through the end of ’09 received three payments totaling $72,500.
permalink | Comment on this post
Spheris’ bankruptcy a year in the making
Posted on February 8, 2010 at 10:51 amJefferies & Co. has been working with bankrupt Spheris since February of last year, according to court documents filed Friday. The financial advisory and investment banking firm has been analyzing the medical transcription company’s business, identifying and evaluating potential acquirers, negotiating with interested parties, etc. In total, Jefferies has received more than $880,000 from Spheris prior to the petition date.
permalink | Comment on this post
Have to wait a while
Posted on February 4, 2010 at 3:38 pmU.S. Bankruptcy Court today granted Spheris‘ motion to extend its deadline for filing its schedules of assets and liabilities for an additional 30 to 60 days. They have through April 5.
permalink | Comment on this post
Brace yourself, it’s a long list
Posted on at 3:10 pmBankrupt Spheris filed its list of creditors today, and it’s quite the ranking. The 203-page document names more than 5,400 of the company’s current and former employees, owners and vendors from Middle Tennessee to Europe.
Of course, the obvious parties are listed — Community Health Systems, Warburg Pincus and Towerbrook Capital Partners. But there’s a sizable representation of local companies, including but not limited to:
Healthways, Highwoods Properties, Gish Sherwood & Friends, Counsel On Call, Second Harvest Food Bank, Carmike Cinemas in Goodlettsville, Parthenon Publishing, Waller Lansden Dortch & Davis, Neal & Harwell, Nashville Health Care Council, Nashville Capital Network, Nashville Business Journal, the Nashville Area Chamber of Commerce, the YMCA of Middle Tennessee, Miller & Martin, the City of Franklin Business Tax Department, Bass Berry & Sims, Gresham Smith & Partners…
You get the idea. The background is at this link.
permalink | Comment on this post
MedQuist to pay $75M for Spheris
Posted on at 8:32 amIn a regulatory filing this morning, medical transcription company MedQuist (Ticker: MEDQ) said its deal to buy the U.S. assets of Spheris will cost about $75.2 million in cash, plus the assumption of certain liabilities.
The agreement comes with a $2.1 million breakup fee, plus transaction expenses, if another buyer ends up winning the bidding and auction process required under Spheris’ bankruptcy.
For now, MedQuist has deposited $7.5 million into escrow that will be credited to the purchase price after the acquisition has closed. If Spheris ends the deal because the buyers breach the agreement, MedQuist must pay the difference between $15 million the $7.5 million plus interest as a termination fee.
For more background on Spheris, click here.
permalink | Comment on this post
Medical transcription venture adds sales exec
Posted on October 1, 2009 at 10:40 am
SPi Healthcare, the medical transcription division of a Phillipines telecommunications company, has hired a former University of Pittsburgh Medical Center manager to expand its East Coast presence.
permalink | Comment on this post
BPO firm buys medical coding compliance venture
Posted on September 3, 2009 at 10:50 am
SPi, a unit of Phillipines Long Distance Telephone Co. that has its health care HQ in Brentwood, has paid more than $8 million for a company that works with hospitals on their medical coding and compliance efforts.
Rising and falling
Posted on March 24, 2009 at 3:24 pmMedical transcription outfit Spheris this afternoon announced its fourth-quarter and year-end results which saw income rise on falling revenue.
Net revenues for the fourth quarter of 2008 were $41.8 million compared with $48.6 million for the fourth quarter of 2007. The decrease in net revenues was due to the impact of net lost business and lower average customer contract pricing.
Operating income was $4.7 million, or 11.2% of net revenues, for the fourth quarter of 2008 compared with $1.2 million, or 2.5% of net revenues, for the fourth quarter of 2007. The improvement in operating income was driven by increased utilization of the global production workforce and speech recognition technologies, in addition to lower marketing, selling and general and administrative expenses that resulted from the Company’s cost-containment efforts. These improvements more than offset the decrease in net revenues noted above. Additionally, the improvement in operating income was aided by lower amortization expense as certain capitalized customer lists were fully amortized.
And here’s the company’s 10-K filed last Friday.
permalink | Comment on this post
Spheris renews GPO deal
Posted on January 13, 2009 at 1:10 pmThe Franklin-based medical transcription firm and group purchasing organization VHA extend for three years a deal that started in 2002. VHA pools the buying power of more than 1,400 nonprofit hospitals around the country.
Recent Comments
Idiot, anybody that would invest in this guy’s ideas...
This is for Gretchen Wilson, I am so proud of you going out on your own,...
Did SItel have any dividend payments in 2009 or 2010?
I’d say planting your flag in the ground so...
Calling a bottom after the fact is not what I call nailing the bottom!
My boyfriend and I live just a few blocks away from Omega.I...
does kroger use this “window” to decide how many illegal aliens they...
Are the pens and pad of paper on the night stand taxed?...
This is hilarious. This story comes up...
Congratulations, Anaheim…you just made a deal with the...
hmmm…how are they going to make that up when they layed off 22 people...
It is not hard to look good when you are comparing year over year to...