Ferguson bankruptcy auction attracting interest

A venerable Richmond business that is on the auction block is generating interest from local and out-of-state prospects.

Mercer Rug Cleansing, in business for 75 years, likely will be sold as an ongoing business concern, said Bill Londrey, an auctioneer with Tranzon Fox.

That business and two other properties associated with it, all part of a bankruptcy filing of a prominent Richmond couple, will be sold this month to pay off creditors.

The properties were open for public viewing this week.

They could be sold together or separately, as a turnkey business or for the intangible assets of the business — including the name, logo and website — or in any number of combinations, Londrey said.

"Our efforts to sell the operating business will hopefully save 15 or so jobs and preserve this viable Richmond business and name," Londrey said.

Roosevelt Johnson, manager of one of the business entities, said he has worked there for 53 years. "I don't know what I am going to do right now," he said Thursday.

The main rug cleaning and repair business has generated an average annual gross of $800,000 to $900,000 in the past three years, according to Tranzon Fox marketing materials.

"I am very confident there will be a buyer for the business," Londrey said. "What we don't know is what the pieces will be. … Our job is to get the most for each piece."

A sealed bid is required by Thursday for the Mercer Rug building and/or business assets at 3116 W. Moore St.

The other two parcels — one across the street at 3115 W. Moore St. and the other, Victory Rug Cleaning Co., at 407 S. Cherry St. — will be sold to the highest bidder at 1 p.m. Dec. 19 at the law offices of Hirschler Fleischer.

Advance registration is required to bid on these two parcels, which will be sold at auction to the highest bidder, not by sealed bid.

"Some people have looked at the properties as investments for potential rehabilitation, multiuse projects, while others have looked at them lock, stock and barrel," Londrey said.

The properties are owned by Allen Mead Ferguson and his wife, Mary Rutherfoord Mercer Ferguson, a couple known for their philanthropy and support of the Boy Scouts of America, St. Christopher's School and the Valentine Richmond History Center.

The couple filed for Chapter 11 bankruptcy reorganization March 31 and converted the filing to a Chapter 7 liquidation June 28. They listed assets of $2.8 million and liabilities of $6.8 million in court documents.

Mary Rutherfoord Mercer Ferguson is the daughter of the late George R. Mercer Sr., who founded Mercer Rug Cleansing and the former Mercer Rug and Carpet Sales Inc.

She is the president and sole stockholder for Mercer Rug and George-Marshall Corp., a real estate company that also filed for bankruptcy protection. Allen Ferguson, the former chairman and CEO of the investment banking firm Craigie Inc. (now part of BB&T Corp.), is secretary and treasurer for both companies.

"These are the remaining assets of significant value associated with the Fergusons to be sold, and hence represent the last opportunity for them and several creditors to recover value," Londrey said.

"How the Fergusons end up and the amount of return to secured creditors hang in the balance with this sale," he said.

Roy M. Terry Jr., a lawyer with Sands Anderson who is representing the Fergusons, said he agrees with Londrey's assessment.

The Fergusons' house near the University of Richmond is under contract, and a court-ordered estate sale of the contents of the house was held last month.

The Fergusons also have a fine-art collection that will be sold. "The sale of the art will benefit creditors," Terry said.

An estate sale early next year of items in a house the couple owns in Rockbridge County will be held as well. The sale of the houses will go toward paying off the mortgages, not benefit creditors, Terry said.