By Lela Garlington
The Commercial Appeal
GERMANTOWN, Tenn. — The company that owns Bausch & Lomb is buying Rural/Metro Ambulance service, but county officials say the pending sale will have no effect on ambulance services.
No matter who has the contract, Germantown officials say they are still exploring the possibility of operating their own ambulance service.
For years, Germantown has wanted to start its own city service similar to what Memphis and Bartlett Fire Departments provide.
Warburg Pincus, a global private equity firm based in Scottsdale, Ariz., announced the acquisition agreement earlier this week. In a news release, the company said Rural/Metro shareholders would get $17.25 per share for common stock . The payout represents a 37 percent increase over the stock’s closing price on March 25.
Subject to regulatory approvals, the deal is expected to be finished by the end of June.
“We don’t think it’s going to have any bearings on operations. Rural/Metro has served the county well, and we don’t expect that to change with the new owner,” said Steve Shular, spokesman for Shelby County Mayor Mark Luttrell.
Rural/Metro has a five-year contract with Shelby County government that includes coverage for Collierville, Millington, Lakeland, Germantown, Arlington and those living in the unincorporated areas of the county. Each city pays a prorated share based on the number of calls within its city limits.
The contract expires July 2012. But both parties have an option for another year’s renewal until July 2013.
Collierville Fire Chief Jerry Crawford said he has no concerns about the ownership change.
“The (new) company has assured Rural/Metro that it would be business as usual,” he said. We’re happy with the service they provide. ... Collierville has no intention of going into the private transport business.”
If Germantown decides to run its own ambulance service, Germantown Fire Chief Dennis Wolf said it won’t be because a new owner has taken over Rural/Metro.
“That decision will be based on having full control, generating revenues for our expenses and trying to improve service levels,” he said.
Ideally, Wolf said, he would want city medics and fire personnel to have full control “from the time someone dialed 911 until they are turned over to the emergency room doctor. To me, that is the key benefit for the city providing the service.”
As it is now, Wolf said, fire department personnel often arrive on the scene first, treat the patient and then hand the patient off to Rural/Metro.
Wolf believes Germantown will stay in the contract until it expires in 2012. Depending on what aldermen decide, Wolf said it would take a year for the city to ramp up and buy the necessary ambulances and hire the additional people needed for a city-run service.
Germantown Alderman Mark Billingsley favors a city-run service.
“In four years, the largest percentage of Germantown residents will be 55 years old and older and the need for emergency medical services will grow,” Billingsley said. “Thus far, I have seen very good arguments for the sustainability of ambulance service to be provided by and be controlled by our own fire professionals versus a profit-driven third-party service.”
If the city does go into the ambulance business, the first year startup costs could be $1.6 million. Fire officials have projected a budget shortfall of possibly $540,000 for the first year of operation and $23,000 for the second year.
In 2010, Germantown paid $409,103 for its portion of the county contract. This year’s costs will be almost $430,000 and about $451,000 for 2012.
Copyright 2011 The Commercial Appeal, Inc.