Don’t believe everything you read on the internet today. Much like the spirit of its riders, Erik Buell Racing refuses to go quietly into that good night. After two failed receivership auctions, the brand has now been acquired for $2.05 million via a third auction held Wednesday, and seems set for another revival.
The winning party of this latest auction is the same winner from the second auction, Liquid Asset Partners – the same company that liquidated Buell Motorcycles when it was shutdown by Harley-Davidson, which makes for some interesting trivia.
Walworth County Circuit Judge Phillip Koss approved the winning bid today, despite a similar bid from Bruce Belfer, the first auction winner. According to a report by the EBR receiver, Belfer’s bid did not conform to the terms of the auction, and thus was not recommended to the court.
The receivership of Erik Buell Racing continues to go on, as the company’s second round on the auction block ended with no fruitful resolution.
It was hoped that Monday would see the announcement of a Erik Buell Racing’s new owner, after the auction on Thursday seemed to show that a new bidder, Liquid Asset Partners LLC, had snatched up the American motorcycle effort and had plans to liquidate EBR’s assets.
However, it appears that the winning bid on Erik Buell Racing’s liquid assets has been contested by previous auction-winner Bruce Belfer and potential-bidder US Heritage Powersport. Accordingly, a new date in court set for January 14th, 2016 and formal motions to be submitted by January 4th, 2016.
This means that the ongoing saga and future of the Erik Buell Brand will continue, well into the start of the new year.
The situation around Erik Buell Racing is rapidly becoming comical, as the American motorcycle brand is headed back to auction, after its sale to Bruce Belfer failed to close.
The Milwaukee Journal-Sentinel reports that Erik Buell Racing will go back to the auctioning block on December 10th, because Belfer was unable to secure financing on his $2.25 million purchase price for Erik Buell Racing.
It’s official, Erik Buell Racing has been sold. The East Troy company went up for auction yesterday, and the Walworth County Circuit Court today put its rubber stamp on the winning bid of $2.25 million, made by Atlantic Metals LLC.
In its bid, Atlantic Metals acquired all of EBR’s manufacturing assets (machines, parts, tools, etc), as well as the company’s intangible assets (trademarks, patents, databases, etc). Atlantic is acquiring these items with no contingencies, per the terms of the auction.
Hero MotoCorp Ltd (HMCL) has filed paperwork with the Bombay Stock Exchange stating that its wholly-owned subsidiary, HMCL Americas, has entered into a settlement agreement with Erik Buell Racing, which sees the American arm of the Indian brand acquire “certain consulting project” from EBR for $2.8 million.
The filing with the Bombay Stock Exchange reads: “”As part of the settlement agreement, HMCL Americas Inc has agreed to acquire the ownership of certain tangible and intangible assets of EBR Entities, free and clear of all encumbrances, for a consideration of USD 2.8 million.”
Social media and some assorted motorcycle news websites (first here, and now here) are feverishly reporting that Erik Buell Racing has been out-right acquired by Hero MotoCorp, during the company’s receivership auction, thus confirming the wet-dream conspiracy theories of Buellistas around the world.
The report was first started by the stalwart news source Motorcycle.in.th, and was then elevated quickly into the realm of semi-truthfulness by a bevy of other news outlets.
Sources close to Buell and Erik Buell Racing have since come forward and discrediting the report, calling the story a complete fabrication. Meanwhile, Hero MotoCorp stock has risen 0.50% on the news.
With the journalistic bar now set so low, Asphalt & Rubber feels comfortable reporting that there is indeed a new owner for Erik Buell Racing, but it is not Hero MotoCorp, but instead the Flying Spaghetti Monster — deity to the Church of the Flying Spaghetti Monster.
After shutting its doors, and putting the company into receivership, the legal process for Erik Buell Racing is moving right along, with a date now scheduled for the sale of the company’s assets.
Slotted to take place on July 21st, potential buyers will be able to bid on EBR’s assets, in bulk. All winning bids are of course subject to court approval, which will be granted/not granted quickly after the auction, on July 23rd.
The bar isn’t set particularly high when it comes to the motorcycle media’s coverage of complex business issues, nor would you really expect it to be. The majority of my colleagues are more likely to have amateur or racing licenses, rather than MBAs or law degrees. Fortunately for A&R, I’m not an accomplished motorcycle racer.
It therefore didn’t surprise me last week that the headlines regard Erik Buell Racing ranged in their proclamations from the more accurate “ceased operations” to “gone bankrupt” – with the even more presumptive publications proclaiming the ultimate demise of the American brand.
This comes from a lack of understanding about how the receivership process works, which my European colleagues should have a stronger grasp of, as the concept is more prevalent across the pond.
As such, I would like to explain the issue further, and how it applies to the situation facing Erik Buell Racing. To entice you on what will surely be a boring subject to many, this doesn’t spell the end of Erik Buell Racing…not even close.
News being broke by the Milwaukee Journal Sentinel says that Erik Buell Racing has ceased its operations. The East Troy company plans to also file for protection from creditors under Chapter 128 of Wisconsin’s bankruptcy code.
Under Wisconsin law, EBR will be placed into receivership (the company will be run by attorney Michael S. Polsky), and ultimately bids will be made on purchasing the bankrupt company. If no bids are made, the company’s assets will be auctioned off, with the profits going to EBR’s creditors.
As Moto Morini marches closer to its April 13th auction date, a new potential buyer has come out of the woodwork for the troubled Italian company. Thomas Bleiner, an Austrian entrepreneur, has his eyes set on the Moto Morini facility with an interesting idea or two up his sleeve.
The proposal for the purchase is expected to be an interesting one, as Bleiner and his partner Gianni Farneda plan on making the dollar and cents of the deal work by installing a 1.1 megawatt photoelectric power system on the roof of the Bologna facility. Bleiner and Farneda have been heavily involved in the solar industry, developing a new photoelectric paint that uses nano technology.
Bleiner and his group believe they could have the factory up and running as early as June with at least eight employees returning to work. With the Granferro and Corsair lines seemingly to be ready to roll, Bleiner says the company could even make a November EICMA appearance. If this sounds a bit too good to be true, then perhaps it is, as Bleiner and his partners have yet to actually submit a bid to Moto Morini’s receiver, despite making the rounds to the Italian magazines and newspapers about their intent to purchase the brand.
Don’t get too excited Moto Morini fans, the Italian brand isn’t making a comeback from the dead as of yet. However Piero Aicardi, Moto Morini’s receiver (the person in charge of handling the company’s affairs during the liquidation/bankruptcy process), wants to re-open the Bologna factory to assemble 45 bikes that are apparently sitting in parts at the factory.
With 16 Scamblers and 29 Granpasso’s capable of being built, Aicardi foresees that Moto Morini could open temporarily to build the 45 bikes, which would sell for €6,300 – €7,100 ($8,500 – $9,600), and use the proceeds to pay off some of Moto Morini’s debts.