Brunswick near deal to sell Hatteras and Cabo

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After six months looking for a buyer, Hatteras and Cabo Yachts appear to be nearing a sales agreement.

Brunswick Corp. plans to sell the Hatteras and Cabo brands to Navis HCY Acquisition LLC, according to a letter sent from Hatteras and Cabo vice president and CFO Robert Nenni to city officials in New Bern, N.C.

“I am pleased to inform you that within the next few weeks we intend to enter into an Asset Purchase Agreement whereby we will sell Hatteras and Cabo Yacht businesses to Navis HCY Acquisition, an affiliate of Versa Capital Management, LLC … which is a Philadelphia-based private equity firm,” Nenni said in the letter obtained by Trade Only Today.

The letter was sent as part of a request that city officials reassign electric power to the new owners, effective upon the transaction’s closing. The sale of Hatteras requires that the electric service agreement for providing power be assigned to the new owners for the remainder of the term of the agreement, according to the resolution.

The board of aldermen voted unanimously Tuesday to approve the request, New Bern city clerk Veronica Mattocks told Trade Only.

Brunswick and Hatteras officials did not immediately return calls seeking comment. Hatteras president and CEO John Ward confirmed to the (North Carolina) Sun Journal that the companies were reaching a deal with Navis, but told the paper: “The deal is not finalized. We are still in the process of negotiating a deal.”

“The formal response from Versa right now is no comment,” Rivian Bell, who is with The Abernathy MacGregor Group Inc., the public relations firm handling Versa Capital, told Trade Only today.

Versa’s portfolio includes Polartec, Bob’s Stores, a Northeastern apparel retailer and outdoor chain Eastern Mountain Sports, to name a few. The company looks for investment opportunities in North American-based businesses with revenue in the $50 million to $1 billion range or assets of $25 million to $500 million, according to the website.

With $1.2 billion of assets under management, the firm is focused on control investments in distressed and special situations involving North American middle-market companies where value and performance growth can be achieved through enhanced operational and financial management, the website said.

— Reagan Haynes

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Comments

4 comments on “Brunswick near deal to sell Hatteras and Cabo

  1. Bill Large

    Great news! Hope this gets the Cabo and Hatteras folks back to work.

    Those are both iconic American brands within our industry and we can’t afford to lose them.

  2. Disappointed

    While I am happy that there is a buyer for Hatteras-Cabo, I cannot help feeling disappointment that yet another “financial group” will take the reins. Holding companies operating very personal marine businesses rarely, if ever find success as the nature of the business does not permit robotic commands.

    The Viking brand is in large part successful due to the hands on operation by passionate entrepreneurs who are first and foremost boat guys. It is the same for the rest of the industry at large.

    Hatteras was born of an entrepreneur’s (Willis Slane) passion and wisdom to seek counsel from those earning a living from the sea. The guidance of the company from its beginning to the point of sale to a large and disconnected multinational corporation in form of North American Rockwell was marked with the hallmarks of quality, on site management and thorough testing by the founder and his chosen team of seaman.

    Since that original and ground breaking introduction the company has lost ground to the competitors, kept afloat by the continuous infusion of capital and a business plan that featured constant over supply causing heavy discounting and reduced resale value, fed by constant model changes at great expense and rendering obsolete the previous highly touted models.

    One could compare the shelf life of the original trio of products for a glimpse at the value of the system adopted by the non boating industry successors to the founders. The original 34-41 and 53 Hatteras enjoyed many years of successful production, each improving on the previous.

    Count the “retired” models from this venerable brand since Rockwell, AMF (another bowling ball company) Genmar (largest marine bankruptcy in the history of the industry), Brunswick, etc. Few have a recognizable shelf life and suffer from very low resale compared to original cost. Few are revered as special yachts as the originals were.

    Sadly, I fear a continuing slide to oblivion unless a boat nut buys the assets and operates it as what all marine businesses really are.

    No large holding company, hedge fund or investor group has shown the ability. will or passion to supply those ingredients.

  3. Cap10pat

    In this case the purchaser is not a marine business (as far as we know) but there must be investors interested enough to put up some money for the purchase. Whether they believe they can resurrect the old Hatteras business or simply make it good enough to resell, we don’t know. Of course, that is easier considering how far down the company has sunk – which has also certainly reduced the price as well.

    Hatteras sales are reported up overseas. Perhaps a foreign firm would be interested in purchasing the Hatteras brand, maybe even moving production overseas – more likely to Europe than to the old Asian sites. All just speculation here, but certainly well analyzed before any purchase is complete.

  4. Rick44131

    These guys are not buying Hatteras and Cabo to turn around and lose money. Hopefully they will retain their new CEO/President John Ward who is a lifelong boat guy from about age 5. Ward understands not only the US boat market but the all important international one as well.

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