Navistar seals the deal, buys Monaco for $50 million
posted on May 22, 2009 11:19
DOVER, Del. -- A federal bankruptcy judge in Delaware today accepted Navistar's $50 million offer to purchase Monaco, RVeNEWS has learned.
There were no other bidders, according to a source close to the case. The deal will be finalized with a settlement scheduled for June 2.
According to court documents, bankruptcy judge Kevin Carey, authorized the sale of all Monaco's assets related to its motorhome, travel trailer and chassis business free and clear of any liens, claims, encumbrances and interests.
Workhorse Holding Company is the official "purchaser," with Navistar acting as guarantor.
Although no formal announcements are expected prior to June 2, speculators suggest that Navistar will retain the Monaco brand, although with fewer dealers than currently carry the product. One source suggested as many as 40 percent of Monaco dealers would be eliminated.
"There will be some pain," said one source. "There is sure to be less dealers."
Kay Toolson will reportedly remain as head of Navistar's Monaco brand and Mike Snell will remain in his role overseeing marketing of the product. The future involvement of Monaco's President John Nepute is uncertain, one source said. Craig Wanichek, Monaco's director of investor relations, has already left the company.
The investment is a sweetheart deal for Navistar, said people familiar with the case. Monaco was a nearly $1 billion company a few years ago. For Navistar to capture Monaco's brands, employees and dealer base for $52 million -- debt free -- will give the company tremendous advantage going into the next business wave, several people speculated.
The fact that Navistar is a nearly $14 billion company bodes well for Monaco, said one source. Navistar is the largest company in the school bus market and having Monaco's brands will give it a tremendous advantage in the RV industry, he added. As of now the plan calls for Monaco motorhomes to be built with Navistar engines and Workhorse chassis. In the past, Monaco built their motorhomes on proprietary chassis.