Bankrupt hockey skate manufacturer bought by Canadian investors

bauer-skates-fairfax-fncanical-sagard-performance-sports-hockey-bankruptcy-maniufacturing-ediweekly

One of the world’s most iconic sporting goods brands is returning to Canadian ownership. Established in 1927 as the Bauer Skate company in Kitchener, Ontario, the famous company has been variously owned by Greb, the US maker of Hush Puppies and Kodiak Boots, Montreal-based Canstar Sports Inc, Nike, Roustan Inc. and currently Performance Sports, based in New Hampshire. Performance Sports announced today that Sagard Capital, part of Power group of Montreal, and Fairfax Financial Holdings of Toronto, are proposing to buy the company’s assets for US$575 million. The company filed for bankruptcy in the US and in Canada on October 28. The sale will be overseen by a Delaware bankruptcy court and the Ontario Superior Court. Together, Sagard and Fairfax already own just over 30 per cent of Performance Group.

In a statement about the deal, Performance Group CEO Harlan Kent noted that the deal was a testament to the buyers’ confidence in the future of the business and its “great brands.” That confidence must indeed be great, as North American sporting goods manufacturers face daunting challenges. Performance Group describes its own current fiscal position in stark terms. Adverse market and economic conditions as well as “customer credit issues” have had a significant impact on the company’s sales. There has been a “significant downturn” in its baseball/softball products sales, while demand for its hockey products has fallen. A major customer, Sports Authority Inc., filed for bankruptcy earlier this year, striking another blow at the company’s sales. As well, the unfavourable foreign exchange rates, the result of Canada’s weaker dollar relative to the US currency, have taken their toll. In spite of cost savings, profitability improving initiatives and corporate restructurings, Performance Group admits that it has been unable to turn the situation around.

Why, then, do the Canadian investors want to buy it? According to Sagard Capital, it, along with Fairfax Financial, has developed a plan that will return Performance Group to “financial stability,” preserve and grow the value of its franchises, and operate a “strong, successful business” over the long term. The plan includes debtor-in-possession financing, whereby the bankrupt company will continue to operate the business while it restructures.

The president of Fairfax Financial, Paul Rivett, commented that Performance Sports has, in its ninety-year history, developed the most recognized names in hockey, baseball and lacrosse, “wth a long-term commitment to quality and innovation.” With the stability that Fairfax and Sagard can provide, Performance Group will continue focusing on innovating “the sports equipment that people around the world know and love.”

Did you miss this?

Other Popular Stories

  • MRO in space: Inside a routine Maintenance-Repair-and-Overhaul mission with NASA: sealing, lubricating and keeping cool
  • Renewable energy now costs less than fossil fuels in some countries: report
  • Canada's auto industry on cusp of rebuilding in NAFTA, but no thanks to CETA: Unifor
  • Manufacturing sector saw slight improvement in August: RBC
  • Diesel emissions fallout continues: US. to sue Chrysler Fiat if talks fail
  • New national aerospace consortium to foster leadership in technology
  • Safer tank cars coming as railways ship more oil than ever
  • French aerospace companies to set up shop in Montreal
  • Vehicle sales, mainly light trucks, continued to soar in January
  • Industrial chemicals producers report second-most profitable year
  • Ontario home builders don't like government's inclusionary zoning plan
  • Within 10 years, almost 50 percent of retail jobs may disappear to automation
  • Moon Race 2: Nasa plans moon lander for 2024; Orion Spacecraft already complete
  • Toyota Canada top producer for first time in 2015; RAV4 on a roar
  • Wasted mechanical energy could solve world's energy needs
  • Auto Sales Down Again for Big Car Makers
  • Cars with “Nerves”? Self diagnostics and magnetostrictive material may deliver cars with feeling.
  • Manufacturing sales rebound in August; industry must "reinvent" itself to prosper
  • NASA Invests in Concept Development for Missions
  • Manufacturing output grew again in August
Scroll to Top