Bankrupt ModivCare’s Junior Creditors Object to $25 Million Deal

Bankrupt ModivCare Inc.'s junior creditors oppose a $25 million settlement between the medical transportation company and its largest customer, saying it isn’t clear whether the termination of their relationship will be final, which could disadvantage creditors.

ModivCare and UnitedHealthcare Insurance Co. are leaving about $15 million on the table in the proposed disengagement, which would only benefit first lienholders if the pair revives the relationship, an unsecured creditors’ committee said in a Monday objection in the US Bankruptcy Court for the Southern District of Texas.

UnitedHealthcare terminated contracts with ModivCare before reaching new agreements, but that information wasn’t disclosed, the ...