Judge Declines A New Offer To Buy Erik Buell Racing Manufacturing Assets

1-1190SXRedRightThe Erik Buell saga has a new episode. The sale of Erik Buell Racing Assets has been denied by a judge to the only bidder, liquidator Liquid Assets Partners who made a $1.6 million offer. In a surprise announcement in April 2015 Erik Buell Racing (EBR) informed its 130 employees that the company was stopping all its operations. During a Wisconsin court proceeding equivalent to a bankruptcy court in other US states, India company Hero Motocorp – owner of 43% of EBR’s shares, acquired EBR’s consulting business for $2.8 million. Then in August, an auction was organized to sell all EBR’s intangible and tangible assets (machinery, tooling motorcycles, and parts) and accounts receivable.

erik-buell-racing-logoAs I reported here on November 19th,  Atlantic Metals Group, LLC from New Jersey led by Bruce Belfer acquired at auction for $2.5 million all Buell’s manufacturing assets and was required to close the deal before September 30. But Belfer failed to secure financing by the agreed deadline and consequently EBR assets were back for a second auction on December 10 with Belfer still stating that he was ready to bid again to acquire all Buell manufacturing assets.

Before last Thursday’s auction and because there was no other bidder, Liquid Assets Partners LLC asked court appointed receiver Michael Polsky to accept a $1.6 million sale offer. Liquid Asset Partners LLC had been involved before with Erik Buell in 2010 when the liquidator sold equipment of Buell Motorcycle Co., the predecessor of Erik Buell Racing. But Bruce Belfer objected to the sale to Liquid Asset Partners, asking again more time to secure financing. In addition, a Louisiana company named US Heritage Powersport producing choppers for sale abroad informed Judge Michael Polsky that it was interested to restart Erik Buell Racing on a smaller scale but needed more time to raise financing.

Polsky eventually decided to decline the offer of Liquid Assets Partners sand will be waiting for other parties to make higher offers. It is his his responsibility to look for the highest bid for Erik Buell Racing manufacturing assets to protect as many as possible of the 850 listed EBR’s creditors. So, as today, instead of being liquidated, EBR Racing may still be back manufacturing motorcycles.


15 Responses to “Judge Declines A New Offer To Buy Erik Buell Racing Manufacturing Assets”

  1. 1 Paul Sharp Dec 15th, 2015 at 9:46 am

    Saga is too long. The brand name get hurt.

  2. 2 18Bravo Dec 15th, 2015 at 10:50 am

    As my Cyclone goes up in value…

  3. 3 Woody's Dec 15th, 2015 at 11:24 am

    On a positive note, it really sounds like the wheels of justice are trying to get the maximum restitution funds available. It’s just entertainment to many folks, but not those getting left with unpaid invoices for goods and services long ago tendered.

  4. 4 BIG DOUG Dec 16th, 2015 at 4:08 am

    let it die for gods sake.

  5. 5 Mike Kiwi Tomas Dec 16th, 2015 at 11:15 am

    This isn’t a long saga. The rebirth of Indian was a LONG saga.

  6. 6 Kris Dec 16th, 2015 at 2:35 pm

    I agree with ‘ big Doug’. – let it die.

  7. 7 Mark Moses Dec 16th, 2015 at 9:46 pm

    What Kiwi Mike said and I some of us still have a scar or two…

  8. 8 Dave Dec 17th, 2015 at 3:57 am

    Long live Erik Buell Racing! Americans need to take more pride in there work! We need more nationalism. Erik Buell has been building bikes that not only compete with the world but through superior design and engineering beat them. Buell while owned by Harley was one of the only parts of the company that increases revenue and increased sales every year that it was owned by Harley. The motorcycle industry does not want Erik Buell in the market because it has the potential to take shares of the market away from a lot of large corporations. People want these bike and more would if they but their ass on one!

  9. 9 pop Dec 17th, 2015 at 6:21 am

    Having owned an Indian from the Gilroy era I can empathize with Buell owners.
    That horse is out of the barn kids. You can stomp your feet and exclaim that you want your Buell back but your Buell is another footnote in motorcycle history. What you own is now represented by a couple of glossy photos and a blurb in some coffee table book.
    That’s it, end of story. Move on.

  10. 10 Woody's Dec 17th, 2015 at 10:06 am

    Taking pride in one’s work includes paying one’s bills. If a sizable amount of people would have lined up to buy the bikes Mr. Buell was connected with we wouldn’t be discussing any of this, right? While I wouldn’t dream of telling someone how to feel, I would gently request folks look at the hard realities of a situation before becoming advocates for something based on feelings. Hobbies are awesome, but businesses need to be profitable and pay their own way.

  11. 11 Demetri Melekos Dec 19th, 2015 at 11:54 am

    FACT CHECK: below is the actual Court record.

    Michael Polsky is the Receiver — Judge Koss is presiding

    Motion hearing
    Koss, Phillip A.
    Schulz, Janet L

    Additional Text:

    C.J. Murray for Receiver Michael S Polsky in court with Caitlyln Herbert. Attorney Domasek, Mike Mitchell, Demetri Melekos appeared via telephone. Court in session @ 10:09 a.m. Appearances made. Matter before the Court for Amended Motion to sell assets. Court addresses Mr. Murray who makes a record of status of case/auction. 10:14 a.m. – Mr. William Melivn III (bidder) responds to Court’s questions regarding plans for the company, future for employees, etc.. 10:19 a.m. – Mr. Murray makes a statement as to sale and informs the Court that the receiver does approve the sale and requests the Court to approval of sale. 10:21 a.m. – Demetri Melekos (interested purchaser) makes a statement to the Court regarding time period needed to get financing approved and has not had enough time due to time frame of auctions and expresses concern regarding timing of process, lack of recovery plan. They have a plan for Phase I Recovery Production. Mr. Melekos responds to Court’s questions and informs the Court that their company would need 90 days to finalize financing. (SBA loan) Court has to disconnect the call due to interference. 10:30 a.m. – Bruce Belfer from Atlantic Metals addresses the Court regarding the sale. Court goes off the record to address parties for next hearing. 10:33 a.m. – Court back in session with same appearances. Mr. Belfer continues his statement regarding sale/motorcycles. Mr. Belter responds to Court’s questions and addresses Mr. Murray as to why notice of objection was same day as auction. Response by Mr. Murray. Response by the Court. 10:42 a.m. – Mr. Murray responds to Mr. Belfer’s claims within his objections to the sale. Mr Murray presents a business plan submitted to Mr Polsky from John Nordstrand. Mr. Murray responds to Court’s questions regarding other objections filed. 10:52 a.m. – Statement to the Court by Mr. David Szewczykowski regarding concerns about this sale and its impact on the community of East Troy. 10:54 a.m. – Court allows Mr. Belfer to continue his objections. 10:56 a.m. – Mr. Murray responds stating concerns if this matter needs to be continued. 10:58 a.m. – Court makes a record and informs the parties he is concerned about making a decision with such a short notice for parties to submit objections. Court proposes to postpone approval until January 14th @ 8:30 a.m. and requires affidavit from Mr. Melvin regarding his offer to purchase. Any party objecting must submit written objections before January 14, 2015. Objections will not be heard on the record at next hearing. Court instructs Mr. Murray to send out notice immediately for next hearing to potential buyers. 11:04 a.m. – Mr. Melvin makes a statement regarding lockdown of 3 facilities as their leases expire on December 31, 2015, and he wants assets protected/secured. Attorney Murray will submit an order regarding concerns. Court in recess @ 11:06 a.m. Minutes filed. Motion hearing scheduled for January 14, 2016 at 08:30 am.

  12. 12 Demetri Melekos Dec 20th, 2015 at 11:27 am

    @Woody – it had nothing to do with a EBR as hobby business not paying bills – it had to do with (z)Hero Motors of India committing to $60 million for the endeavor, and only putting in $25 million – due to their corporate douchery and greed to take Erik’s 16 redesigns of (z)Hero’s aged products that haven’t been update since Honda did the originals over 30 years ago – (z)Hero caused EBR to go into Chapter 128 receivership by not putting in the remaining $35 million, then bought the IP to EBR Consulting Co. for $2.8 million … that is a $32.2 million discount — and in the process leaving EBR $20.8 million in debt to Vendors that will literally see pennies on the dollar of what they are owed — dig ?

  13. 13 Woody's Dec 20th, 2015 at 11:55 am

    I dig, Cyril’s done an excellent job reporting all that over the latest incarnation.

  14. 14 Stony Crane Dec 21st, 2015 at 11:43 am

    I think some modifications this could actually work. It’s never easy.

  15. 15 Ron Ulywood Jan 10th, 2016 at 5:10 pm

    I know so little about all that is necessary to bring a product to market such as the EBR line. I love my Buell Ulysses and was longing for the much anticipated EBR AX adventure offering that I also believe would have been a big seller in Europe. The Ulysses has little to no resale value so it will continue to serve me well as I save up for the next upgrade somewhere down the road. I believe what hurt EBR as well as the Hero disaster was the lack of a solid dealer network. It costs a fortune to take on a brand with parts and service training along with the floor plan for rolling inventory. After Harley dropped Buell, Erik was without a dealer network.

    Whoever wants to get this ball rolling has a long uphill battle securing dealers that will be more hesitant to take on a line that has already crashed. Who wants to inventory anything that will soon be or eventually be non-existent. As I have thought about this, the only company in the US that I think could make a go of EBR may be Polaris…they have a dealer network between snowmobiles, atvs, Victory and Indian motorcycles etc. They seem to be marketing with some success everything that rolls for fun and why not a sport motorcycle line, which they do not have. A few million dollars is a drop in the bucket for their deep pockets.

    Like I said, I know little or nothing about what it takes…but just the same…wouldn’t it be nice if…

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