March 17, 2018
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Bankrupt Getchell Agency could be sold for $3.4 million

Judy Harrison | BDN
Judy Harrison | BDN
The Getchell Agency, located in a strip mall on Outer Broadway, is to be sold next month in U.S. Bankruptcy Court. A stalking horse bidder has offered $3.4 million for the company that operates residential homes for adults with physical, cognitive and developmental disabilities.
By Judy Harrison, BDN Staff

The financially troubled Getchell Agency Inc. is on track to have a new owner by the end of March, according to documents filed in U.S. Bankruptcy Court.

A stalking horse bidder has offered $3.4 million for the firm that operates residential homes in Bangor for adults with physical, cognitive and developmental disabilities.

A stalking horse bidder is chosen before an auction to ensure there’s a starting bid and a willing buyer if no better bids are received.

Emile Clavet of Auburn, who owns Health Affiliates Maine, which provides mental health services, submitted the stalking horse bid.

Health Affiliates has an existing relationship with the Maine Department of Health and Human Services, which is Getchell’s only source of income. Bankruptcy trustee Nathaniel Hull said last week that the ownership transition could go more smoothly if the buyer already has a relationship with the department.

Other companies have until March 26 to submit competing bids, according to Hull. The new owner is expected to named March 27 by U.S. Bankruptcy Judge Peter Cary, with a closing date set for April 3.

The Getchell Agency filed for bankruptcy in March 2016, three years after former employees filed a class-action lawsuit over unpaid overtime for employees who slept on site during overnight shifts. That case was settled through the bankruptcy process.

In late November, Cary removed owner Rena J. Getchell from the day-to-day operation of the business and appointed Hull, a Portland bankruptcy attorney, as trustee. Hull hired Sweetser of Saco to run the agency.

The agency in December borrowed $350,000 from the Department of Health and Human Services to solve a cash flow problem.

Last month, Getchell took in about $1.33 million and spent about $1.17 million, for a gross profit of nearly $160,000, according to a January report filed in bankruptcy court. That does not include past-due bills or other debts.

The agency can serve up to 72 clients. The current number of clients was not included in the January report.

As of Jan. 31, it had 139 employees, 10 fewer than when it filed for bankruptcy, according to court documents.

The purchase and sale agreement calls for the new owner to continue offering care to Getchell’s clients and to employ its current workers.

Once the company is sold, the Getchell Agency’s legal troubles won’t be over. The health department has lodged fraud allegations against Getchell, which the agency has denied. Last year, Cary appointed a special examiner to investigate those allegations. As of Friday, the examiner’s report had not yet been filed in bankruptcy court.

The Getchell Agency has not been charged with any crimes involving how the business was run.

Clavet has his own legal issues. He is a controlling member of Provider Power, parent company to competitive electricity supplier Electricity Maine LLC, which faces a proposed class action covering thousands of customers. The complaint claims customers were lured by false advertising with the promise of saving money into electricity contracts with Electricity Maine for their homes between 2011 and 2014. The lawsuit lists Provider Power, Spark HoldCo LLC, as well as Clavet and Kevin Dean, another controlling member of Provider Power, as defendants. The case, filed 15 months ago, is pending in federal court in Portland.

Efforts to reach Clavet over the weekend were unsuccessful.

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