Boatmaker Genmar files for bankruptcy protection
Amid a downturn in the boat-building industry, Minneapolis-based Genmar Holdings has filed for bankruptcy protection. The privately-held company is headed by Twin Cities businessman Irwin Jacobs.
According to the company's Web site, Genmar has about 5,000 employees and about a dozen different boat brands, including Glastron and Larson.
In the company's 2007 model year, sales totaled approximately $1 billion.
Genmar traces its roots back to 1978 when Jacobs purchased Lund Boat Company.
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The Chapter 11 petition lists assets of $237.5 million and liabilities of $216.5 million.
Jacobs said the petition does not include over $400 million in intangible assets. Wells Fargo and Fifth Third bank, the only secured creditors, are owed $75 million.
"Even up until the last few weeks this is something I never even dreamt was a remote possibility," Jacobs said Monday.
He estimated Genmar's revenues for the year ending June 30 should drop by more than half to about $460 million, and Genmar will have a cash operating loss of $32 million to $35 million, compared with a cash operating profit of $9.7 million in 2008.
In addition to the company's Minneapolis headquarters, Genmar has operations in Little Falls, Minnesota. The company has facilities in several other states as well.
The boating industry has been hit by high gas prices and the recession. The National Marine Manufacturers Association has said sales of new boats fell 30 percent in 2008 and are expected to drop another 20 percent this year.
(The Associated Press contributed to this report)