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Fountain Aquired Baja

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Old 03-20-2008, 08:38 PM
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Brunswick Announces Sale of Baja Marine Assets to Fountain Powerboats
LAKE FOREST, Ill., March 20 /PRNewswire-FirstCall/ -- Brunswick Corporation (NYSE: BC) today announced the signing of a letter of intent to sell certain assets relating to its Baja boat business to Fountain Powerboat Industries, Inc., of Washington, N.C. Terms of the agreement were not disclosed, and completion of the sale is subject to certain conditions. In preparation for the transition, Brunswick plans to end production of Baja boats in Bucyrus, Ohio, by the end of May, consistent with the end of the 2008 model year. As a result of these actions, the company said it estimates that asset write-downs, along with severance and other costs associated with the plant closure, could total between $10 million to $15 million, pre-tax.

"This was a strategic decision to further refine our product portfolio and best focus our resources on brands and marine segments that we believe are core to our success going forward," said Brunswick Chairman and Chief Executive Officer Dustan E. McCoy. "This action in no way reflects upon Baja or the abilities and performance of the Bucyrus work force. We believe, however, that Baja and its dealers will ultimately benefit from being a part of Fountain Powerboats, a company that, like Baja, is a leader in high-performance boats."

When completed, the closing of the Baja plant will mean a loss of approximately 285 positions. Baja leadership will be working diligently to transfer as many employees as possible and practical to either Fountain or other Brunswick manufacturing facilities. For those employees who do not have the opportunity or do not wish to transfer, severance will be provided.

About Brunswick

Headquartered in Lake Forest, Ill., Brunswick Corporation endeavors to instill "Genuine Ingenuity"(TM) in all its leading consumer brands, including Mercury and Mariner outboard engines; Mercury MerCruiser sterndrives and inboard engines; MotorGuide trolling motors; Teignbridge propellers; MotoTron electronic controls; Albemarle, Arvor, Baja, Bayliner, Bermuda, Boston Whaler, Cabo Yachts, Crestliner, Cypress Cay, Harris, Hatteras, Kayot, Laguna, Lowe, Lund, Maxum, Meridian, Ornvik, Palmetto, Princecraft, Quicksilver, Rayglass, Savage, Sea Boss, Sea Pro, Sea Ray, Sealine, Triton, Trophy, Uttern and Valiant boats; Attwood marine parts and accessories; Land 'N' Sea, Kellogg Marine, Diversified Marine and Benrock parts and accessories distributors; IDS dealer management systems; Life Fitness, Hammer Strength and ParaBody fitness equipment; Brunswick bowling centers, equipment and consumer products; Brunswick billiards tables; and Dynamo, Tornado and Valley pool tables, Air Hockey and foosball tables. For more information, visit www.brunswick.com.

SOURCE: Brunswick Corporation

CONTACT: Daniel Kubera, Director - Media Relations and Corporate
Communications of Brunswick Corporation, +1-847-735-4617,
[email protected]
Web site: http://www.brunswick.com
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Old 03-20-2008, 08:39 PM
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Originally Posted by TexomaPowerboater View Post
Still sounds like a pretty sweet deal to me.

Its not like they are going to kick these people to the streets like so many are implying. Since you are in to M&A why don't you inform us of what on average a typical employee comes out with in a severance package.
No problem, what do you want to know? I am basing my comment on some M&A experience, the fact that I have done consulting work in over 150 different financial institutions and seen acquisition fallout in dozens of communities from companies with everything from 20 to 5,000 employees.

The actual answer is actually a based on industry and circumstances. Finacially, it is typically based on seniority. Your guy that cleans the floor gets maybe a month. You top guys may get a year (yes I have seen more). I have seen it all over the board. I doubt that the average joe gets more than 6 months in a company like this. I am not privy to Baja's financial statements but would like to know how Fountain with a NOL of $5MM is supposed to pay a bunch of "sweet" severance packages.

Let's see, the middle of the road employee gets a few months income, a COBRA package and goes to look for a new job in a declining economy. How is that sweet? Based on looking at asset quality in dozens of financial institutions over the last two years, I can tell you that the average employee might have enough liquidity to make it a couple of months. Sweet? I don't think so. These are not the guys that are running around in boats like most folks on this board drive.

I can back my statement up all day long. What is the basis of your "sweet deal" scenario?

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Old 03-20-2008, 08:40 PM
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That sucks. I used to work down there and there a lot of good people in that town that were really proud of Baja Boats as it is one of the most recognized names around the globe in the go fast market.
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Old 03-20-2008, 08:43 PM
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what were 07 unit production numbers for both fountain and baja?
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Old 03-20-2008, 09:12 PM
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I don't think so.
Because Reggie is going to hire BigChubby to haul them all to N.C.
OUCH!!
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Old 03-20-2008, 09:35 PM
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Sounds like a smart move. No if 's no and's and no Baja's. Reggie just created a huge dealer network for his product.
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Old 03-20-2008, 09:40 PM
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If I were a Baja owner, I would be concerned about the warranties on any Baja's purchased in the last few years.
What happens in a situation like this?
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Old 03-20-2008, 09:44 PM
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what were 07 unit production numbers for both fountain and baja?
anyone?
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Old 03-20-2008, 10:22 PM
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Originally Posted by Northern Baja View Post
Is this going to work like the Brunswick era Harley's? Once the big profits on low quality ran out, owners of product produced during those glory years forever have a low quality cloud over their heads?

What about the Ohio Plant closing? Is this true? I realize Fountain wasn't a big money maker last year, but grabbing on to an even larger anchor during it's freefall doesn't seem like a solution.
I think you got your bowling balls mixed up. Brunswick never screwed up Harley, AMF did that.
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Old 03-20-2008, 10:38 PM
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Originally Posted by dreamer View Post
anyone?
Fountain 100, Baja 300

While this may seem bad for the folks in Bucyrus, would it have been better for the company to not sell, and have to go BK down the road. The severence packages in that case would have been much worse.
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