Kit Manufacturing Co. now intends to sell both its RV and manufactured housing businesses to “unaffiliated third-party buyers,” the company announced last week.
The company is not free to identify either potential buyer at this time although Bruce Skinner, Kit’s vice president and treasurer, said today (Jan. 2) that the potential buyer of the RV Division currently is involved in the RV industry.
The buyers will be identified when the deal closes, which will occur sometime after Jan. 10, Skinner added. Last week, the two potential buyers signed “non-binding letters of intent” to buy Kit’s two businesses.
The buyers will pay cash and assume the debts of Kit’s RV and manufactured housing divisions but more specific terms were not revealed.
Additionally, Kit announced that its previously disclosed plan to sell its RV Division to Scott Thorpe has been terminated. Thorpe is the sales manager of Kit’s RV Division, but he was unable to obtain enough financing to complete the acquisition of the division.
“We (Kit) want to sincerely apologize to our dealers for any potentially misleading information,” Skinner said. “Those (RV and manufactured housing) businesses will continue to be viable entities” after they are sold.
Also, after the close of stock market trading on Jan. 10, Kit stock will be delisted from the American Stock Exchange (AMEX). The company asked to be delisted from the AMEX in order to avoid having to file expensive documents related to the sales, Skinner said.
Beginning Jan. 13, Kit stock will be traded on the so-called “pink sheets” until the sales are finalized.
Kit’s shareholders will need to approve of both transactions, but Dan Pocapalia, the company’s founder and chairman, owns 49.3% of Kit’s outstanding common stock, and he approves of the deals. Consequently, shareholder approval is expected.
The RV Division now accounts for about 56% of Kit’s total sales revenue, which amounted to $34 million during the nine months ended last July 31. Kit incurred a net loss of $3.1 million during the nine months ended July 31.
Kit builds travel trailers and fifth-wheels under the brand names Road Ranger, Companion, Millennium and Extreme.