Fleetwood files bankruptcy

Fleetwood stock is up 45% (still only pennies, though) on the strength of this good news from the bankruptcy court.

[Press release from Fleetwood follows]

RIVERSIDE, Calif., April 3 /PRNewswire-FirstCall/ -- Fleetwood Enterprises, Inc. ("Fleetwood"), a leading producer of recreational vehicles and manufactured homes, today reported that the U.S. Bankruptcy Court has approved orders that the company requested to support the continued operation of its motor home and manufactured housing businesses.


On April 1, 2009, Fleetwood received authorization through an interim order to obtain up to $80 million in Debtor-in-Possession ("DIP") financing to supplement the company's working capital needs, including a $65 million sub-limit for Letters of Credit that the company had in place prior to its Chapter 11 filing. The Court authorized the DIP financing as senior secured super-priority post-petition extensions of credit from its lenders, led by Bank of America, N.A. as agent. An additional hearing will be held on April 21, 2009, regarding a final order on the company's DIP financing.


Fleetwood also announced that its requests to pay pre-petition dealer and retailer sales incentives and warranty service claims for Fleetwood motor homes and manufactured homes were approved. Under Chapter 11, the company is permitted to continue to pay for approved post-petition warranty service that is performed on Fleetwood motor homes and manufactured homes and to pay for sales incentives earned on or after March 10, 2009, in the ordinary course of business.


Additional requests made since the company voluntarily filed for Chapter 11 on March 10, 2009, have also been approved. The orders, entered by Judge Meredith A. Jury of the Central District of California in Riverside, include:

    * Authorization for Fleetwood to access its pre-existing cash management systems and its cash collateral.
    * Approval to pay outstanding pre-petition employee expenses and workers' compensation claims.
    * Authorization to pay certain common carriers and other vendors for pre-petition amounts outstanding. The company has submitted a motion requesting permission to pay certain additional vendor claims, which has not yet been heard by the Court.



Copies of the entered orders are available electronically at www.kccllc.net/fleetwood.

Gary --

All that does indeed sound good, but do you have a link to an English translation? ???

Or, as my grandsons and their friends might say, "Like, what does that mean, Dude?"

Don

It basically means that they can continue business pretty much as usual while in bankruptcy, paying their bills and employees.

The Debtor In Possession financing thing means they can probably obtain more working capital loans. Without that provision, nobody would lend money to a firm in bankruptcy because any new loan would have very low priority for repayment. With it, the new loan gets top priority for repayment, reducing the lendor's gamble substantially. It sounds like Bank Of America is  working with them on the DIP financing needs and  hopefully the court order will clear the way for for some badly needed working capital.

Thanks, Gary

Its a shame GM can't do this.  I guess its easier to get free money.

Its a shame GM can't do this.

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They might do that yet.  I was reading yesterday that they're going to try to meet the government's next deadline, but the backup plan is to file for Chapter 11 if they can't.

ArdraF

Fleetwood announced today that AIP has bid $53M for all the Fleetwood motorhome brands and the production facilities in Decatur, IN (5 plans) plus all associated intellectual property and tools. Fleetwood diesel coaches are currently built in Decatur but the gas chassis lines are built in California, so apparently some brands and related tooling would either be moved to Decatur or be dropped from the product line. The offer has been submitted to the bankruptcy court and an auction proposed for 6/22/09.

http://www.rvbusiness.com/2009/05/aip-offers-53m-for-fleetwoods-rv-division/

It is reported that the $53M bid from American Industrial Partners (AIP) has been approved by the bankruptcy court and will be the stalking horse for any other bid. If no other bids are received (and nobody else seems to be knocking on the door), that's the way the deal will go down. The AIP bid is for the motorhome production facilities in Decatur, IN, and all intellectual property and tooling associated with motorhome production.

Fleetwood also is selling its military housing operation to housing giant Clayton Homes, a subsidiary of Berkshire Hathaway.

For more info see:
http://www.decaturdailydemocrat.com/content/view/161890/1/1/0/

More about this:

"American Industrial Partners Capital Fund IV, LP, of New York offered $53 million for the most of the motorhome division. The bankruptcy court has approved AIP's proposal but the purchase cannot be formalized until the completion of the bidding procedure later in June."

Read the complete article

The bid by AIP for Fleetwood's motorhome business has held up and it appears there will be a new coach manufacturing company based in Decatur, IN. No details yet but folks in Decatur are happy and hoping that at least some of them will get back to work this summer.

More info here:
http://www.rvbusiness.com/2009/06/aip-bid-for-fleetwood-operations-in-indiana-holds-up/

RV Roamer said:

The bid by AIP for Fleetwood's motorhome business has held up and it appears there will be a new coach manufacturing company based in Decatur, IN.

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That's great news, Gary.

We stopped in Fleetwwod's parking lot a week ago today for lunch. It was an eerie feeling not seeing any activity at the plant and especially no motor homes parked around both sides. We often hit Decatur around lunch time and if it is on a weekend we find the huge parking lot very convenient for a lunch stop.

If you had stopped by the American Coach service area on the corner of Patterson St and US 27 you would likely find a few people there, though maybe not on the weekend. AC is still doing service even though the production line is idle.

There is a new AC, Fleetwood mfg rep at Lazy Days, actually a return, Jayne Fairley, formerly FW rep, had switched to Monaco, and is now back rep'ing both lines.  I worked with her in both her capacities and she is fantastic.  She should be back on siite at LD shortly. 

They won't go down without a fight.

http://www.rvbusiness.com/2009/07/fleetwood-bounder-classic-in-the-heart-of-the-market/

Fleetwood didn't have a real entry level coach any longer, so the Bounder Classic fills a hole in the product line. But the first coach the new Fleetwood actually sold & delivered was a 45 foot American Eagle.

http://www.roamingtimes.com/b/articles/3/american-coach-first-american-eagle.aspx

We have an 02 prowler lynx with a composite floor (thin plywood top, Styrofoam center, thin plywood bottom bottom membrane.  The outside skirt let water in on top but was sealed on the bottom and held it in.  The water wicked into the thin plywood that then de-laminated and caused a complete structural failure of the floor.  Since the walls sit on the floor, this is a big problem and some posts call this failure terminal.  I feel this is irresponsible and downright deceitful manufacturing from a company who has been in business long enough to know better.  I'm glad they are gone.

I found this difficulty only in forums.  I can't believe publications with action lines and letters to the editor littered with incidental component difficulties have not encountered the same problem.  I can believe they are looking out for their advertisers more than their subscribers.

My father in law recently owned a new C class on a Kodiac chassis.  Looked beautiful but close inspection revealed serious quality issues and within a few trips gaping gaps became obvious.  The manufacturer promised repairs after an extended trip and then forgot their commitments when the one year warranty ran out.  He took a horrendous hit (maybe half) when he dumped it after two years and is still paying the note.

The industry my be caught by this economy, but it may also be experiencing the fallout from the sobering reality that hotels cost less than repair of poor workmanship and provide better service.

The industry my be caught by this economy, but it may also be experiencing the fallout from the sobering reality that hotels cost less than repair of poor workmanship and provide better service.

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I don't think that's it. In fact, towable RVs have continued to sell throughout the past year. At lower rates than previous years, to be sure, but still selling in significant numbers. A few manufacturers have even expanded production for popular models, e.g. the Montana.

But you are certainly right that manufacturers could easily do a better job of designing for a reasonable lifespan. And companies that have been designing and building RVs for years send out just as much thoughtless crap as the newbies.  :'(