A bankruptcy court judge in Minnesota Wednesday approved all bids for Genmar's assets, chief restructuring officer Mark Sheffert said.
The sale will officially close Jan. 20.
California-based Platinum Equity purchased the majority of Genmar Holdings' assets for $70 million. J&D Acquisitions purchased Carver and Marquis for $6.05 million. And MCBC Hydra Boats, a subsidiary of Wayzata Investment Partners, purchased Hydra-Sports for $1 million.
J&D Acquisitions is a company founded by Genmar founder Irwin Jacobs and billionaire businessman John Paul DeJoria. Wayzata Investment Partners also owns MasterCraft Boat Co.
Mark Barnhill, a principal with Platinum Equity, said in an e-mail this morning he could not comment because "the transaction has not yet been completed and remains under the supervision of the U.S. Bankruptcy Court. Until the sale is completed, it would be premature and inappropriate to discuss any operational plans for the business."
The Official Committee of Unsecured Creditors had asked the judge to set aside the results of last week's auction or, alternatively, deny approval of Jacobs' bid for the Carver and Marquis lines.
The committee said it appears the aggregate amount of the prevailing bids will not satisfy the secured claims, the Chapter 11 administrative expense claims, and will provide nothing for the prepetition unsecured creditors as a group.
There are an estimated 4,000 unsecured creditors that are owed more than $100 million, according to court documents.
The committee also objected to the decision to award J&D Acquisitions the winning bid for the yacht group brands and the facilities in Pulaski, Wis., over an identical bid made by Genmar Yacht Acquisition, which the committee said is an affiliate of Patriarch Partners LLC.
GYA also filed its own objection in the case.
"The committee's objection is nothing more than anger directed at an individual owner of a bankrupt debtor who is not legally responsible to pay the debtors' debts to unsecured creditors, who may, unfortunately, go unpaid," J&D said in court papers.
"Genmar went bankrupt because of economic conditions," the document continued. "Mr. Jacobs and other entrepreneurs cannot change that, but they can attempt to rebuild the businesses that have been lost."
— Beth Rosenberg
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Dear Flash074:
You are correct the marine industry has suffered problems. Small and big companies have all taken hits due to the downsizing created by the financial institutions, for credit and floor-plan funds available, not to mention new curtailments.
Genmar elected not to negotiate with everyone, and use the funds to repurchase assets through a blind company. Not even a minimal payment, negotiated under bankruptcy protection. They let the assets go to auction.
You make great point.... where is the inventory he purchased? Did they build boats, and not pay for the materials, or did they ship boats and let the dealers deal with it? The vendors know how much was shipped, and it was more than daily production schedules. SOOooo.. where is it ? I bet it appears before long and it won't have any debt.
I can appreciate your desire to be loyal to your customers. They are the ones who trusted you, and purchased what you recommended etc. The future will change the product line no matter what. New people will instill their strategy and changes will happen, better or worse. It won't be the same !
You owe it to yourself to adapt to the changing conditions and offer the best products and service you can to your customers. It might be the revamped Genmar brands, and maybe something else. It is obvious you have passion for the industry and your customer, and that's what makes a good a dealer. I'm glad you are energized to build a better tomorrow. I wish you great success, and thanks for the discussion.
As I said yell and scream.... If you can't make a point. Make it bold and italize and maybe capitalize next time. People will listen to you more....
If you didn't get the hint last response let me spell it out. I don't mind having a great discussion. But I don't appreciate being insulted. Yes, you and many may not agree with me. Fine, it is one point. I don't know why you feel the need to tell people how smart you are by putting down others. Is your point anymore valid than others? I took the so called bullet just like the others. All I am saying is what Genmar went through any worse or better than any other company. You say yes, I can appreciate your view. I say it is the same thing. In my humble view( not that it matters) Mr. Jacobs is no more guilty of anything more than any other company that has faultered. But for me if Jacobs owns the company again I will not drop the brand and disservice my customer again simply to make a point. That is not smart business to me. I owe it to Mr.Customer (especially who bought over the last year) and the good people I worked with at the plants that treated me so well during the good years to continue. Maybe you won't that is your choice if you are a dealer.
To conclude, I have to respond to the grand conspiracy theory of buying all this product before filing for BK. That is a very strong statement without a very strong basis of facts to support it. Let's theorically say I agree with you. Explain to me where all this product is? It is funny because I have waiting for months for boats because they don't have all the parts and pieces to finish them?
Signed "lack of intelligence"
Hey Flash:
Yes, I did address you and your knowledge. Companies involved were negotiated with and "they" decided their method of payment. Basically, if you wanted full payment immediately a discounted rate was decided. If you would take an extended payment plan within one year. FULL payment was made. (Check out the Vendors yourself)
Most combines of any size with reputable business practices offered the same plan. If under capitalized, and bad business practices you had one choice and that was bankruptcy. Genmar was neither, however the proven facts are clear, Mr. Jacob's made increased purchases over several months building inventories, knowing the future strategy would be to file bankruptcy. He could bid through a blind company and repurchase what he wanted with excess inventories to start up again. If he failed, so what,..... but if he was successful he would be able to start again with very little costs.
As I've said before, he didn't cause anything, but has manipulated the system unethically to start again. Yes, he has been responsible for many families having jobs etc. This does not erase the facts of his business practices, and his reputation over many years of business. Just think, if he was the golden cow, wouldn't everyone in the financial communities have offered him help.
Every other company has had situations and problems, but it is how they delt with the circumstances that have made the difference. Brunswick, Volvo, the IBBI, ABA, MRAA groups all have "negotiate" with vendors. Guess who didn't ??? Guess who took the bullets ... employees, dealers, banks, and vendors.
Grand Man:
Since you addressed me personally. Your the one who feels "duped" and I am the one supposedly with the "lack of knowledge". Let me think about that?
Seriously, happy about receiving a partial payment? Really? Really how happy would you be if someone owed you money, gave you a partial payment, and then bought something else. The point is none of these companies are any better than the other. Love him or hate him Jacobs did no worse or better than any other company faultering including the auto industry other than not use tax dollars. At least we didn't get raped for tax dollars we will never see.
Move on... Find a customer... sell a boat... Try to make today a better day.
Some of your postings really show a lot of anger toward Irwin. I am not a huge fan of Erwin either. But, I have been a dealer selling his product and I have worked for Erwin. Genmar stood behind its dealers during the down turn offering rebates nad anythong else corporate could do to help dealers sell boats. It is not his fault. Maybe you should think abot the other baot companies. Did they offer huge rebates to help sell product? Did they contiune other marketing programs? Genmar ried to make it and I really doubt they wanted to srew everybody in the process.
You should be more upset with the dealers who let GE take their boats because they were tired of making monthly payments. They are the reason you are now paying 12% interest to GE.
People lost jobs, vendors lost money. Sorry, folks thats business and it happens everyday. The only reason the car industry survived was becasue of our tax dollars.
I hear Erwin even put $30million of his own money into Genmar before the bankruptcy to keep things going.
As an employee I worked everyday through the bankruptcy not knowing if I wold get paid or not. But I continued to support the dealers hoping that good would come out of this mess.
Time will tell but I think this whole Genmar sale will help business. And I believe a few more will fall.
I worked for Genmar and I have to ask these questions yet again:
Did Irwin create the Global Finacial Crisis - no the banks did
Did Irwin stop dealers buying boats - no the dealers did
Did Irwin stop customers walking in to dealerships and buying boats - no customers did
Did Irwin stop floor plan financing - no the banks did
Did Irwin stop banks lending to consumers - no the banks did
Did Irwin create the Bankruptcy Act - no the legislators did
Did Irwin for 30 years pay people wages and help put food on the table an put kids through school and college etc - probably responsible for about 50,000 peoples lives - YES he did!
Did Irwins companies for 30 years but goods and services and make many companies executives rich, which in turn paid their employees wages and help put food on the table an put kids through school and college etc - probably responsible for about 200,000 people lives - YES he did
Can anyone who is complaining PLEASE LOOK AT THE FACTS - otherwise you look really stupid
Dear "Flash"
Your lack of knowledge about both the industry, and people reflects in your statements. First MasterCraft "negotiated" with their creditors and vendors. Under their plan, most of their vendors will be paid in full. Their plan was well received. The VC group bought Hydra Sports, which also purchased MasterCraft last year.
This is NOT the case with Genmar. They have duped the vendors, and financial institutions. Jacobs's history precedes him in the marine industry. He did not create any of the problems, however it is how he chose to deal with the situation, during and since the industry slowed down. Many companies took a different approach in settlements.
It is unfortunate for all involved, the vendors, employees, and the communities where these facilities are located. The manipulations of the system, and the untruths continue. Time will tell whether the Genmar brands will survive.
New people, and new directions will dictate the future. The companies are good, but new strategies will definitely be forthcoming
well being close too carver and knowing the area,they will work with jacobs and do there damn best ,
carver builds one of the finest boats out there,bassboat and runabouts are a differant ballgame.
stop your whinning about jacobs.... go back to bank and whine .. theres the problem.. its ust nots boats.
ken
Oh how quick we forget. How come nobody remembers Mastercraft settling with its vendors. Many as I read have still not been paid in full. Now they can pay for another boat line? Is this any better. Why would the vendors do business with them under many of these posts logic.
I am a dealer that has Genmar product and I have to say some of the posts are right. Are you going to further disservice your customer by completely dropping a line if Jacobs were to own one of the brands you represent? Does that make it right for Mr. Customer who bought into you and the brand you sell? Not to mention the good people who work and support their families in the plants and at the vendors.
It is unfortunate that Genmar filed for bankruptcy it put a lot of good people out of work at the plants, vendors, and dealerships. So you can point fingers at Mr. Jacobs if you want and yell and scream. But none of these people complained about him when they were making lots of money. Maybe some of these exact people should have stopped when times were good and come up with a good business plan that can survive through poor times as well. That is the ultimate problem here. Poor business plans. Yes, this is tough times. Yes, this is a bigger recession than ever dreamed of. Yes, us and everyone else struggles everyday. But the days of just saying let's open a dealership, vendor, or boat plant with no business plan are over. Which will make everyone stronger in the end. If Mr. Jacobs is guilty of anything it is a poor business plan that could outlast a downturn. No more no less.
So in conclusion, I ask, if a dealer files for bankruptcy or closes their doors then turns their stuff to the bank or sticks a vendor, is this any better or worse than what Genmar or any other company did. I say No it is the same thing. The vendors under bankruptcy had the option to work with settling. They choose not to, and as the judge stated took the risk and lost plain and simple.
Let's all move on to selling boats and putting people back to work that have suffered enough. This is in the end is the only thing we can do to make it better for everyone.
Tom, you mean VEC not vtec I'm sure and I would hardly call what mr. Jacobs spent to acquire it and subsequently develop it "nothing"
VEC and many other businesses are better off for Irwins vision. Yes, it looks like some were hurt by the bankruptcy bit what about all the years that preceeded this? It's not like they had accounts receivable dating back to 1992 when we last had a major downturn in the boat biz. They were paid for years.
Nobody like to lose money but I bet if I told suppliers they would get decades of profit from me and some day they will lose 30 to 120 days worth of invoices in bankruptcy, I bet people would still repeat what transpired here.
When Clint Moore or Bruce VanWagoner post on here that they won't do business with Irwin, then I will know he's really done somethign wrong.
Onward.
The tragedy in this whole mess is the number of small suppliers that Irwin has put out of business. This will have a ripple effect throughout our industry. Unfortunately Irwin gets to continue fleecing both dealers and suppliers unless dealers refuse buy from him. It goes to show, it's who you know and how much money you have.
This in dustry needs a good flushing to get rid of all th BS.
I agree with Mr. Thorne. I work for a genmar company and I am patiently waiting for this to play out so we can have a chance at jobs and get people out of the unemployment line. There is alot of people to point fingers at but in the end it all comes down to a domino effect. What this person does effects this person and so on and so forth down the chain. There is more than one person to blame but by all means you can't even pin it to one specific person. So if you want to pull your business from "genmar" or whatever these businesses will be called, that's your right. But that's business that you will lose as well. Do we need to remember that high gas prices contributed to a slow boating industry.....or did we forget just in time for gas prices to hike once again.
Quote from above:
"The committee's objection is nothing more than anger directed at an individual owner of a bankrupt debtor who is not legally responsible to pay the debtors' debts to unsecured creditors, who may, unfortunately, go unpaid," J&D said in court papers.
"Genmar went bankrupt because of economic conditions," the document continued. "Mr. Jacobs and other entrepreneurs cannot change that, but they can attempt to rebuild the businesses that have been lost."
Not every boat company went Chapter 11 during these "economic conditions". Those that are well managed (especially with cash flow) have survived. I think Mr. Jacobs filed right after he told the world everything was fine in his camp. I wish the crdited the source of the above quote.
A WARNING TO ALL. CAPITALISM IS SUPPOSSED TO WORK PROPERLY WHEN ALL THOSE INVOLVED STAY AWAY FROM CORRUPTION, ILL INTENTIONS, UNSCRUPOLOUS METHODS AND PRACTICES.
OUR PRESENT ECONOMIC STATE IS CLEAR EVIDENCE THAT WHEN THE GAME IS PLAYED UNFAIRLY, AND FOR AS LONG AS IT HAS BEEN GOING AMOCK, WELL IT EVENTUALLY CATCHES UP WITH ALL OF US.
UNFORTUNATELY WE ALL END UP PAYING THE PRICE, WHILE SOME IRWINS STAY AFLOAT.........THOUGH THEY EVENTUALLY GET THEIRS, THE OLD "WHAT GOES AROUND COMES AROUND" IS GUARANTEED.
OUR SYSTEM IS IN DANGER
Oh Jesus!
What a bitterness of some individuals comments. Mr Jacobs didn't invented this depression. We should blame on thiefes and high bosses inside and outside your banks and irresponsible political institutions, they caused this situation.
THE RICH GET RICHER, 100 MILLION UN PAID,
HOW IS THIS ACCEPTABLE???????
Cheat me once "Shame on you" Cheat me twice "Shame on me"
You ready to jump in line to do business with Jacobs.....again?
With Jacobs it's just a matter of "Who's Next"!
This chapter is coming to a close... so now we turn to the future. We all get to choose who we want to do business with.
It makes sense to choose do do business with companies that have a proven track record of high integrity and sound financial management.
My Father new Irwin when he was just a slime opportunist years ago, everyone that knows him knows what he is, and what he has done to make his money. Is anyone really surprised? I truly do hope that vendors band together and refuse to sell to him, however , I do not really think it will happen...too many sales managers are only interested in increasing their sales, at any cost.
Shame of it is it looks like he got the Vtec technology for nothing, and that may just bring him back to the forefront again. Dealers...run and hide when he comes calling, you will be sorry.
How unfortunate for those in Pulaski. The same people that put that ship on the rockpile are back at the helm again.
Put your life jackets on and hold tight.
The economy told them to make changes long before the bankruptcy, and they ignored all, and spent spent spent....lived it up and ignored all the warning signs until it was way too late.
My heart goes out to all the emloyees and vendors. Remember who did what here people. They are still there, while the rest struggle to live and eat.
A very sad day.
What a completely slimy individual. Irwin personally directed his boat companies to place inflated 90 day orders to practically every vendor-hardware, plumbing, upholstery, etc for deliverables on the eve of his premeditated filing just so he could maximize how much he screwed them. funny thing is...he had the gall to then call many of these same suppliers back once he was given operating leeway by the court and request additional supply even as these companies held the previous unpaid bills that he claimed he was simply "not allowed" to pay.
One can only hope the consumer market might recognize how disgusting this man is and perhaps we can only hope they'll never retail another Carver or Marquis again.
Mr. Jacobs embodies everything that is wrong in American industry today. Stuffing his pockets with Genmar and FLW money at the same time he claims they're in the red. Taking money from his partners, allowing for bankruptcy filing, then swooping back in to buy his own crap at a discount after the debt is wiped clean.
Gross.