MedCath Moves Toward Dissolution
MedCath Corp. announced Monday that it will file a proxy statement with the SEC to request stockholder approval to authorize the MedCath board to dissolve the company, sell its remaining assets without further stockholder approval, and distribute available net proceeds to stockholders. MedCath hopes to file the proxy during its fiscal third quarter ending June 30, 2011.
Charlotte, NC-based MedCath is a healthcare provider focused on high acuity services, especially the diagnosis and treatment of cardiovascular disease. It began by providing acute care hospitals with mobile cardiac catheterization labs and transitioned into hospital ownership in partnership with physicians.
In its heyday, MedCath had ownership interests in 13 hospitals in nine states, 27 cardiac diagnostic and therapeutic facilities in 12 states, and a rental fleet of mobile and modular cardiac cath labs.
The dissolution does not come as a huge surprise. In March 2010, MedCath retained Navigant Capital Advisors and announced the formation of a strategic options committee to consider the sale of the entire company or the sale of its individual hospitals and other assets.
Although there was no formal announcement of which option MedCath would pursue, the individual sale of many of its hospitals and the sale last week of MedPartners, one of its two operating segments, signaled that the company was liquidating.
In recent years, MedCath's financials have taken a beating. The company reported a loss from operations of $30.5 million for the year ended Sept. 30, 2010 and a net loss of $21.1 million for the same time period. That performance followed a net loss of $54.6 million from operations for the year ended Sept. 30, 2009 and a net loss of $58.6 million for the same time period.