Skip to main content

Gunboat president resigns as auction nears

The company announced this week that founder and president Peter Johnstone stepped down.

North Carolina-based Gunboat International Ltd. will be sold at auction as a single lot to bidders, according to an amended motion filed in bankruptcy court on Tuesday.

The company also announced this week that founder and president Peter Johnstone stepped down. Barry Carroll, who was serving as COO, was named the new president. Papers filed today in U.S. Bankruptcy Court in the Eastern District of North Carolina requested compensation throughout the process for Carroll in his new role.

A company spokesman cited “ongoing corporate restructuring” as the reason for the change.

“Mr. Johnstone felt the change would facilitate a successful restructuring and help ensure the continuation of the iconic brand and its team of skilled boatbuilders,” Gunboat said in a statement.

“The Gunboat family owes a debt of gratitude to Peter,” Carroll said. “Without his creative flair, knowledge, and energy, Gunboat would not exist.”

The company confirmed to Trade Only Today that Gunboat continues to employ 60 people and is currently constructing six boats. A custom Gunboat 78 is nearing completion and five carbon fiber Gunboat 55 sailing cats are in the process.

“Work continues and no reduction to the boatbuilding team is anticipated,” the company said in a statement.

Meanwhile, an amended sale motion filed on Tuesday sought authority, among other things, to establish a maximum breakup fee that would be paid to any stalking horse bidder designated. Stalking horse is the term for a viable bidder that is designated to prevent absurdly low offers.

The motion also proposed that the breakup fee the company is allowed to pay be kept confidential to allow flexibility to attempt to negotiate a lower breakup fee with potential bidders. All bid packages need to be received by the bidder and court by March 29.

Gunboat filed for Chapter 11 restructuring in November, with Johnstone citing a “perfect storm of adverse business circumstances, mistakes and disputes.” Johnstone was later upbeat about the situation, telling Trade Only at the time that the company was poised to rebound.

A list of the largest 20 creditors amounted to roughly $6,025,845 million in claims, though there were more than 100 claims in total. Assets were listed at $1.1 million, and total liabilities were about $15.6 million, according to court documents.

Leading to the bankruptcy filing were several challenges, including a legal dispute between Gunboat and Hudson Yacht and Marine Industries, a Chinese builder Gunboat contracted to build the 60 and subsequently sued. Gunboat alleges in court documents that HYM never did some work and that the yard refused to pay warranty claims on other poorly constructed yachts. It also said the company launched a knock-off brand. HYM has denied the allegations, filed a countersuit and blamed Gunboat for the problems.

Court documents also showed there had been cost overruns with the 55-foot series that led to the “termination of several contracts that were in various stages of production.”

Also on Johnstone’s list of troubles was a G4 capsize in April and a recent photo boat collision during a magazine boat test in Annapolis, which Johnstone said has “thwarted” sales of the series.

The third problem that he said led to the Chapter 11 filing was the abandonment of Rainmaker by her owner and crew.

On his Facebook page Monday, Johnstone posted the Trade Only Today story announcing the pending auction with the message: “Spread the word. Gunboat's assets to be sold. Would love to see the brand get into the right hands for the next chapter.”

Related

1_.MARTIN_FLORY

PR Firm Celebrates 60th Anniversary

Martin Flory Group has served the RV and marine industry segments since 1962.

Screen Shot 2022-09-26 at 9.29.49 AM

Mack Boring Turns 100

The New Jersey-based engine and components supplier, started in 1922 by Edward “Mack” McGovern, today is still a family-run business.

2_IBEX

IBEX Canceled

Tropical Storm Ian is expected to strengthen into a hurricane and impact Florida’s west coast sometime Wednesday.

3_Manitou-MY23-VW06-Rotax-Engine-Cutaway-Feature

Clearing the Deck

Bombardier Recreational Products unveiled the Rotax outboard with Stealth Technology in August

AdobeStock_306648964

Shoring Up Your Defenses

Marine businesses are just as open to cyberattacks as all kinds of other businesses in nearly every industry

1_Silent_Jet_Render_Main0214

Hinckley Unveils SilentJet

Hinckley Yachts teamed up with Wisconsin-based transmission-maker Twin Disc to create a hybrid electric system called SilentJet that can switch automatically from diesel to electric power, depending on how much throttle you use.

IMG_8361

Finding the Next Buyers

Discover Boating commissioned a research study to fine-tune targeting efforts in marketing.