With a new owner, Fountain exits Chapter 11

Posted on February 04, 2010
Attention: open in a new window. Print

Fountain Powerboat Industries has emerged from Chapter 11 bankruptcy protection, company founder Reggie Fountain told Soundings Trade Only this morning.

See Related Articles

The privately-held company is now owned by Liberty Associates, which also is the majority shareholder of Donzi Marine and Pro-Line Boats.

Fountain, who filed Aug. 24, 2009 for bankruptcy, said he's happy with the outcome of the case.

"We've been pretty fortunate all along," he said. "I think the judge noted that we had one of the lowest groups of payables to our vendors that he'd seen in a bankruptcy."

Fountain will stay on as president and CEO of the company and says he will buy back into the company, though not at the 51 percent of shares he once owned.

California-based FB Investments had attempted to buy the company, after it purchased the note from Regions Bank. After a court fight, however, the company recently approved Fountain's reorganization plan.

Fountain said Liberty Associates will pay FB Investments the money it is owed by mid-March, if not sooner.

There are currently about 120 employees at Fountain. That number had fallen as low as 20 last fall, Fountain said, adding he hopes to bring more employees back as the economy allows.

Several years ago, Fountain employed 350 people in its North Carolina facility.

"The economy is going to determine [when we can bring more employees back]," he said. "We can't force that, wouldn't want to force that after getting out of Chapter 11."

Fountain also noted the company is much leaner and running with less overhead than it once had - as much as $1 million a month less.

Back in 2006, he noted, Baja and Fountain combined did $160 million in business. He hopes to be back to at least half of that amount in three to five years.

"I'll be tickled if that happens," Fountain said.

For more on this story, see the March issue of Soundings Trade Only.

— Beth Rosenberg

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Comments
7 February, 12 2010, 10:35 AM
By Wild Child

Reggie has done more for our sport than anyone I know. He is always pushing the limits of boat building, racing & marketing............................ The statement that he is running his company into the ground is BS! Think about it wisely! Why would anyone want to run their "Baby", their life long commitment, & their  livelihood into the ground? The economy must take a large part of the blame and our slow economy has taken it's toll on many excellent businesses. Not too many people looking for $100 to $500k boats right now...

6 February, 05 2010, 09:03 AM
By Terry G.

Capt Brian, I fully understand why he wanted to stay on as CEO, it's called ego.  The day Reggie ran the company into the ground is the day he should have lost the right to be it's leader.  When exactly did we as a society stop demanding accountability?  Why should we accept this type of behavior within our industry "leadership"?  Reggie, Jacobs & others of their ilk are wreckless & should be called out on their actions, either by their corporate partners or prospective customers.


The very same people who defend this type of corporate behavior are the same people who think they know what free market capitalism is...you all are sadly mistaken.    

5 February, 04 2010, 04:38 PM
By Capt Brian
Without Reggie, there would have never been a Fountain boat to begin with.  I can fully understand why he wants to stay on as Pres / CEO and I don't blame him in the least.  He deserves to be at the helm.
4 February, 04 2010, 02:43 PM
By mario aiello
Recievership is better than Bankruptsy. I am glad Irwin Jacobs did not own any part of Fountain. Go Dealers !!!!!!!!!!
3 February, 04 2010, 02:34 PM
By Terry G.
Not sure how you can call Oxford Group vultures when they infact were asked by Reggie to purchase the Regions bank note.  Reggie balked when FB Investments was not going to keep him on as CEO.  This is all per court documents.  Reggie is right up there with Jacobs in my book...crooks.
2 February, 04 2010, 01:34 PM
By Blake Davis

Good news. I've alway's liked the Fountain product and glad to see them coming out ok.. SPEED ON brothers!


Nice to see a Bankruptcy ending up with satisfied vendors- FOR A CHANGE.

1 February, 04 2010, 01:29 PM
By Captain Tom
Business 1 - Vultures 0

Add your comment

Your name: Required, screen names acceptable
Your email: Required, will not be published

Comments are moderated and generally will be posted if they are on-topic and not abusive. For more information, please see our Comments Policy.:
  The word for verification. Lowercase letters only with no spaces.
Word verification:
yvComment v.1.21.1

Most Popular