Just over a month after Nautic Global Group’s private equity owners said they were putting the company up for sale, pontoon manufacturer Bennington Marine finalized a deal, acquiring all eight Nautic brands.
Bennington said in early October that it had completed the purchase of the brands and “certain assets” of Nautic Global Group and that it is assuring dealers and customers that the brands will continue to function independently. NGG CEO Jim Malone says he expects the turnaround to move swiftly.
Dealers who spoke with Trade Only expressed sentiments ranging from excitement to trepidation, although several felt it was too soon to comment. One who carries the entire Nautic Global Group portfolio expressed a twinge of anxiety about the competing Bennington dealer across the street.
Terms of the deal were not disclosed. But the brands Bennington acquired — Godfrey pontoon boats (which includes Aqua Patio, Sanpan and Sweetwater), Hurricane deckboats, Polar Kraft fishing boats and Rinker cruisers (which includes Captiva Sport Boats) — are being held in a newly formed holding company and will be operated separately from Bennington. The acquisition will not affect existing operations, dealer networks or retail customer relationships for Bennington or the acquired brands, the companies say.
“We are excited to bring together some of the strongest brands in the marine industry,” Bennington CEO Jacob Vogel says. “And we want to assure dealers and their customers that it is business as usual. Production, servicing and marketing of these terrific brands will remain separate and strong.”
Saratoga Boatworks manager Josh Mance says he was surprised to hear that Bennington, producer of a single line of pontoons, would be buying all of the NGG brands — a portfolio his company carries in its entirety. “I think the surprising thing is that they took on everybody. It seems some of them are more profitable than others,” Mance says.
Mance says it is too soon to offer much of an opinion about the transaction, but he did express curiosity about what will happen with the Bennington dealer across the street. “That is a big question that we have yet to still work out,” says Mance. “That’s a big unknown.”
That dealership carries several competing brands, Mance says, and is not fully committed to Bennington. “They have multiple lines of pontoons,” he says, adding that Bennington is a competitor to some of the NGG pontoon lines his Saratoga, N.Y., dealership sells.
But he thinks there will be time to get it all worked out before the winter boat show season begins. “We have plenty of time to get stuff figured out,” he says. “We’re still committed to Godfrey. We’re placing orders right now.”
One Water Marine — the product of a merger of Singleton Marine with Legendary Marine a year ago — operates in 28 locations. Three of those locations carry Bennington, says One Water manager Scott Cunningham.
“Although Legendary had a great relationship with NGG, we are looking forward to the opportunities in having a company as strong as Bennington take over the operations,” says Cunningham. “With their expertise in the fast-growing saltwater pontoon market segment, we are optimistic that the Bennington way of doing things will carry through all the NGG product lines.”
Portland Shelton, marketing manager for Anglers Choice Marine (three locations in Virginia and North Carolina), says its Lexington, N.C., outlet carries Bennington and Hurricane, but in Martinsville, Va., Harris is the pontoon sold. But if someone called one store and wanted the other brand, they would be transferred to the store that carries it, she says. “It just seems like different customers are used to certain brands on their lake or areas close to them,” she says. “They’re able to talk to neighbors or friends about Hurricane or Harris or Bennington. The price points are different, too.
“We just went through this when Johnny Morris bought everything bass boat,” she says. “Ranger, Triton, Tracker, Nitro — now he’s got the whole gamut, and those were all competing brands before the purchase.” The consolidation has made it logistically easier to manage the brands, she says.
“Now with Nautic Global, many of what used to be competing brands for us will all be under the same umbrella,” she says. When she heard about the acquisition, Shelton called Lexington, N.C., sales manager Mark Mullies, who seemed excited about the deal. “He was looking forward to streamlining of the order platform, and inventory,” she says.
Some dealers seemed concerned about the parts and accessories arm of the business, which has been a concern in the recent past. After Nautic Global brought Malone on in late 2013, the company held a roundtable to address dealer concerns — most notably long lead times on products, parts and accessories. Malone conceded then that those lead times were “not what they should be,” but he says the production schedule was 20 percent higher than in the previous year.
“We are dramatically increasing our throughput on Hurricanes [deckboats] and pontoons,” Malone says. “That is up over 30 percent.”
And progress, he says, was being made on the “nagging quality issues and detail stuff that are a pain in the neck to the dealer network.” But after spending the past year ramping up production at some South Bend, Ind., plants that had been idle or used for storage, the company decided to put itself up for sale.
“I have heard about a P&A problem over the last several years, but getting parts has never been an issue for us,” says Mance. “We have tons of warranty parts on the side of the building here. As far as the Godfrey brand is concerned, we’re the fourth-largest dealer in the world. They always took good care of us.”
Mance thinks there will be little change in the way things are run, especially since the two companies operate in the same community. “As dealers, we call in to the Nautic hub to ask about warranty claims or new-boat orders — it all goes to the same system. I think for now, it’ll probably be run pretty close to how it was. But it will be interesting to see how Bennington controls the P&A.”
The announcement that Elkhart, Ind.-based Bennington was buying Nautic Global Group, also based in Elkhart, came in late September. Bennington founder Steve Vogel said at the time that the acquisition would give dealers an opportunity to expand their product offerings.
“Current dealers of either or both brands will have opportunities to expand their representation, and the companies announced that the intention is to distribute dealer- specific news and meetings scheduled shortly after the closing,” CEO Jacob Vogel says in a statement. “At this time we are planning on operating these acquired brands and businesses as an organization separate from Bennington, but with the same world-class attention to quality and customer service.”
Nautic Global is the sixth-largest U.S. boat manufacturer and has as much as half of the deckboat market share with its Hurricane brand. It has been owned by private equity firms Silver Point Capital and Oaktree Capital for nearly a decade, Malone says — a long time by private equity standards. It was formed in 2005 when Godfrey Marine and the Rinker Boat Co. merged.
“The entire Elkhart-area community will benefit from the acquisition,” Malone says in the statement announcing the sale to Bennington. He says the deal “represents a big win for the employees, dealers and customer end users.”
Jacob Vogel calls it an “exciting opportunity for both companies” and a “historic transaction in the boating industry.”
This article originally appeared in the November 2015 issue.