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A tough market for
production builders?
WHAT DO THE RECENT COLLAPSES OF WELL-KNOWN YACHT BUILDING COMPANIES
SIGNIFY FOR THE INDUSTRY? FORMER BUILDER PETER POLAND OFFERS HIS VIEWhe first quarter of the 2018 business
year did not start well for some
venture capitalists and private equity
firms in the boatbuilding business. First, we
saw the collapse of Oyster Marine Holdings
in February after owners HTP Investment
called in KPMG because the company had
been ‘unable to secure financial support to
enable it to continue to trade’. In April, software
entrepreneur and keen Oyster sailor Richard
Hadida bought Oyster from the administrators
for £6.7m, according to data filed at Companies
House, and says he’s willing to invest significant
personal money for the next chapter.
Then in April giant German boatbuilder
Bavaria succumbed, going into self-administration. Current management remained
until June while new investors were sought..
Bavaria’s Nautitech catamaran arm (acquired in
2014) continues as normal in France, however.
Current owners Oaktree and Anchorage
Capital bought Bavaria in 2009 for a rumoured
€550 million from Bain Capital, who paid an
eye-watering €1.1bn to the founder in 2007.
As with Oyster, this shows what can happen if
you buy at the top of the market just before a
recession wreaks its financial havoc.
So are the days of venture capitalists as
yacht builders now numbered?
When I abandoned the security of a family
insurance business to join Hunter Boats as
company co-owner in the 1970s, prophets ofdoom said the only way to make a small fortune
from boatbuilding was to start with a big one.
Since I had neither, this was academic.
But I soon learned a lucky lesson. A top
accountant looked at Hunter’s figures and told
me: “These seem surprisingly good. What’s
your delivery time on these Sonata and
Impala things?”
“Over a year,” I proudly replied.
“Idiot,” he said. “Put up your prices.
Immediately. You won’t always do this well so
you should cash in now. Put something aside
for the inevitable bad times.”
As the years went by I watched our
competitors such as Westerly, Sadler,
Snapdragon, Macwester, Rival et al go bust.T
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