Industry Consolidation

Beneteau has acquired Rec Holdings, the builders of Glastron, Four Winns, Wellcraft and Scarab. Part of the reason was for US manufacturing facilities as well. Now Beneteau's boat business hasn't been making money which brings expansion into question.

How does this pertain to yachts? Well, first Beneteau has several yacht brands. But, second it is a resell of a US manufacturer previously acquired by an Investment firm/Venture capitalist in Platinum Equity. To be seen whether it's good or bad for the brands acquired. But others like Hatteras/Cabo have been acquired by similar funds, H/C by Versa. A resell three to five years from now is highly likely and will be interesting to follow. It's what happens when Investment companies acquire or Mergers and Acquisitions and Operations companies as Platinum prefers or Capital Management firms as Versa prefers.

The industry will continue to be shaped by the nature of firms buying and selling builders. When a Chinese Bulldozer manufacturer buys Ferretti as they did, that makes one think. But seemingly that is a manufacturer buying in another industry, not just an investment in an asset. Westport sells to a boatbuilder, although largely commercial. Hinckley and Hunt are purchased by an Investment firm. Grand Banks buys Palm Beach Motor Yacht.

Another interesting comment that was made was that for smaller boats building in Europe and shipping to the US made no sense, hence the need by Beneteau of US manufacturing. How can this bode for those such as Grand Banks which once sold largely in the US? And might this ultimately become a problem even for yacht builders in the low to moderate price range.