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think that this factor substantially offsets the demographic
challenges of operating home health care agencies in Mississippi.
Petitioners also maintain that there was no market in
Mississippi for acquisition of the Sta-Home tax-exempt entities.
The record in this case, however, indicates that there were many
such sales, including the purchase of Mississippi home health
care agencies by out-of-State hospitals. We are not convinced
that reasonable exploration by a willing seller would have failed
to turn up a willing buyer, whether in Mississippi or elsewhere.
F. Excess Value
Having found the fair market value of the Sta-Home tax-
exempt entities, we turn to decide the value in excess of the
assumed liabilities. We are satisfied that the Sta-Home for-
profit entities intended to, and did, assume all of the
liabilities of the predecessor businesses. The evidence includes
an audited balance sheet, prepared for purposes of this case,
which indicates that the total liabilities as of September 30,
1995, were $13,310,860. To this amount we think there is
properly added $201,000, as ascertained by Hahn, representing a
reserve account for cost claims disallowed by Medicare. Total
liabilities assumed were therefore $13,511,000. Subtracting the
total liabilities from the fair market value we have decided,
results in an excess of $5,164,000:
Fair market value $18,675,000
Assumed liabilities (13,511,000)
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