Fleetwood Enterprises Inc. is seeking bankruptcy court approval to sell most of its motorized RV business to New York private equity firm American Industrial Partners L.P. for $53 million, subject to higher offers at auction, according to the Dow Jones Daily Bankruptcy Review.
The deal would allow Fleetwood to unload one of its two primary business units, part of the company’s plan to sell off its assets in an effort to repay creditors.
American Industrial Partners is seeking to buy five plants, additional machinery and all brands and intellectual property tied to Fleetwood’s motorized RV business, according to papers filed Friday (May 15) with the U.S. Bankruptcy Court in Riverside, Calif. The purchase would consist of a portion of Fleetwood’s intellectual and physical properties. The five plants are all located in Decatur, Ind. AIP is not offering to purchase any travel trailer property (intellectual or physical) or Fleetwood’s motorhome facility in California.
Under the bidding rules, competing bidders would have until June 18 to submit initial offers. An auction would take place on June 22.
Fleetwood is seeking to pay American Industrial Partners a $1 million breakup fee if it’s bested at auction.
The private equity firm showed the most “serious interest” of some 75 potential buyers contacted by Fleetwood’s financial advisers, the company said in court papers. Other bids were “too low or subject to significant contingencies,” Fleetwood said.
The Riverside, Calif., company, which also produces factory-built homes, filed for Chapter 11 bankruptcy protection in March, blaming the global recession for reduced demand for its products. Weakness in the RV market has hurt Fleetwood for several years. The company has reported a net loss in each fiscal year since 2001.
At the time of its Chapter 11 filing, Fleetwood employed 3,700 people at 19 manufacturing facilities in 11 states.
The company began the process of shutting down its travel trailer business unit and is seeking a buyer for its housing division.