Dealers still face uncertainty after Genmar sale

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Although the auction is over for the assets of Genmar Holdings, uncertainty remains for thousands of unsecured creditors, dealers and former or current employees.

On Friday it was announced that California-based Platinum Equity had purchased the majority of Genmar Holdings’ assets for $70 million. Carver and Marquis were purchased for $6.05 million by J&D Acquisitions LLC, a company created by Genmar founder Irwin Jacobs, along with John Paul DeJoria.

MCBC Hydra Boats, a subsidiary of Wayzata Investment Partners, purchased Hydra-Sports for $1 million.

A court hearing to approve the sale is set for Wednesday, with the closing set for Jan. 20.

However, Jacobs told Soundings Trade Only he planned to purchase certain assets back from Platinum Equity after the court hearing, including the Larson brand and its factory, FinCraft, Triumph and Seaswirl.

“I don’t think [the news] helped the welfare or the well-being or the mindset of any dealers anywhere,” Phil Keeter, president of the Marine Retailers Association of America, told Soundings Trade Only this morning. “Now we know who’s going to own parts of it, but we don’t know any more than what we did two weeks ago about what’s going to happen.”

Keeter said he’d already talked with two dealers who were giving up on Genmar brands and moving to other boat lines after the news broke.

Steve Grams, a Larson, Glastron, Seaswirl and FinCraft warranty rep in Little Falls, Minn., for the last 13 years, was laid off last September for what was supposed to be two to three weeks and is still out of work.

“It looks as though the saga is not over for me and others in Little Falls as Mr. Jacobs states that he intends to try to purchase the Little Falls operation from the high bidder. I hope he is successful in that endeavor,” Grams said.

“It should be mentioned to all that in the Little Falls area there has never been anyone in the entire world that has invested more of his own personal fortune into the local economy than Irwin Jacobs, and I, for one, hope that this continues,” he added.

There are an estimated 4,000 unsecured creditors in this case, according to Unsecured Creditors Committee chairman Gary Potter, general manager of EZ Loader Boat Trailers.

With the total sale price adding to approximately $77 million, it’s unclear if any money would be available for the unsecured creditors on the case.

Potter could not be reached for comment this morning.

“I think all this did was show that the secured creditors are going to get far less than what they’re owed,” Keeter said.

– Beth Rosenberg


13 comments on “Dealers still face uncertainty after Genmar sale

  1. King Walleye

    That’s just great… Genmar sells for 77 million and the unsecured creditors get to split 77 cents.


    The bigger they are the bigger the splash when they go under. Once the economic waves die it will be a tighter and better industry for both customers and surviving manufacturers but that will be a few years away. Until then the industry will continue to tred water

  3. brian

    any person or business that deals with jacobs after this mess will get what they deserve, burned. jacobs saw an oppertunity with the down economy and took it not caring who he destroyed. i hope vendors have learned a lesson also. if jacobs stays in the marine business he should be made to pay cash upfront for anything he or his companies purchase so he does not have the chance to screw anyone again.

  4. retired dealerman

    Like the automotive business, the boat business follows. As I grow older, I’m continuously amazed at how foolish investors and corporate boards are. They make a money from an established business and then fritter it away on purchases of other businesses, give the execs a huge bonus for doing the deal and before one knows it, all the companies topple over from their own excesses. Witness GM and it’s purchase of SAAB. Acting like wheeler-dealers and still unable to not only manage the companies responsibly, yet can’t figure out that the consumer hasn’t been satisfied with the shoddily built vehicles.

  5. Boiler81

    Please Platinum, do not sell Jacobs anything………  I do not want his Germs on anything else I still have in inventory till I figure how to get out from under it and then stay as far away as possible

  6. George C. Horwatt

    What really went wrong here is Jacobs’ expectations for his businesses were grossly unrealistic.  He exacerbated this bad situation by borrowing beyond his capacity as he convinced everyone that he was worthy.  I don’t feel sorry for any unsecured creditor as they assumed their risk and now have to live with the consequences.  Didn’t anyone see how Amway billionaire Rich DeVos lost millions by investing with Jacobs?  I’d say Jacobs has no credibility left with most as he blames everyone but himself for his problems. However if he is able to convince folks that his investors can profit by him, more power to him.  Furthermore, there’s nothing wrong with the bankruptcy system with regard to business filings and no reason why Jacobs should be banned from repurchasing assets as he too takes risks in not being successful.

  7. Tired of the Political BS

    Blah Blah Blah;  Does anyone realize that the only reason Corporate America survives is b/c of the blue collar workers…it should be noted that thousands of employees of Genmar were lied to.  Specifically those that left Florida and followed the company in 2008 to the promise of a future in MI and TN.  Only to find there wages cut shortly there after and their jobs lost.  WHY did Genmar uproot these people, when it is obvious now that they were on the wings of a financial break down. WHY, to save their rear ends, honesty obviously isn’t Genmar’s best policy!
    And the biggest screwing of all went to TN….This is the plant that has been building boats and supporting Genmar, even today-as this is written, with a skeleton crew of around a half dozen, building a quailty Hydrasports product that used to be built by an assembly line of many.  Meeting and exceeding their promises with the highest ranking efficiencies and lowest overhead of any Genmar plant.  That is until they are ‘fired’ tomorrow or at weeks end and their plant closes down b/c Platnimum is so smart that they think there is not a market for Saltwater boats.  REALLY, what has been selling ‘Oh so smart Ones’.  Where has the money been coming from for the last 6mo to a year.  HOW IS THAT FOR JUSTICE!
    I could care less anymore.  NOBODY really cares about the jobs that are lost, only there bottom lines.
    Maybe this is ranting but I think it should be hear.

  8. sailing instead

    Well I am sure glad the C suite was able to dump debt and move on (over the backs of the good people that made Gemar great).  But now that it’s crystal clear Gemar is taking it’s cues from Wall Street, maybe Jocobs can be properly tared and feathered like the rest of the theives.

  9. barb ruud

    jacobs shouldn’t be allowed to purchase anything where other people work hard for a company to make it grow and be proud of the product they made. he has shown every one in the industry he can’t be trusted. he doesn’t seen to care about people,just his money.

  10. Sinking boat

    With all of the bailouts and such it would be nice if the honorable judge would award the money owed to past and present employees… instead of the profitible Wells Fargo who is looking to foreclose on our homes because we can’t pay our mortages, thanks to this bankruptsy.

  11. Grand Man

    Ole Boat Builder is right…………. This is the first step in procedures.
    The next steps will be filings and hearings, protests etc. The exercise will be to determine who has legitimate claims to actions filed, and what will the results of the court decisions. Once all of this has finally filtered out, the Genmar group will not have what they believe today is the final results. Any strong presents in the year ahead will be tough for them to address, until the courts review actions and decide in favor of the creditors, or  dealers, and possibly the bidders.

  12. Ice Fishing

    Unfortunatly Genmar was run by bean counters who kept cutting budgets while forcing dealers into ever more stock.  All this despite warnings the market was shrinking and the banks were backing away from floor plan.  Instead of investing in the core business, the companies were milked to invest in other hair brainned businesses of Jacobs and his lackies.  The accountants forgot to feed the machine.  Employees were forced continually to do more with less.  Stop investing and of course the business is going to fail.
    Platinum should really focus on the core business and take care of the dealers.   They produce the orders.
    Good luck to all the families who have been destroyed by this.

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