Corbin

[MAC]

Corbin for sale $11,500,000 anyone?
http://thekneeslider.com/corbin-pacific-motorcycle-seat-maker-up-for-sale/

[gwb_mg]

Won't it be great if Moto Guzzi bought them and put the Corbin on all their bikes, only wish Corbin still had seats available for the Cali II. Well I can dream can't I.

[jackson]

Corbin has officially been "for sale" for around six years.  Here's an article from 2009.  http://www.inc.com/magazine/20090501/business-for-sale-a-motorcycle-seat-manufacturer.html

[Yeahoo Whoyah]

 Maybe they meant 11,500,000 Japanese Yen, about $96,750 - that's more like it.

[LeRoy]

Interesting.

In the 2009 article the Corbin business reportedly employed 115 people and was on a three-year slide in both gross revenue and cash flow. Annual sales of new motorcycles in the US market had been averaging close to 1,000,000 for the past 6-7 years. Price: $11.5 million.

In the 2015 article, Corbin employed 90 people and no information on revenue or cash flow is provided. Annual sales of new motorcycles in the US market have been averaging less than 500,000 for the past 6 years. Price: $11.5 million.

In neither case does the price include the real property (land, building, etc.) The price is apparently driven largely by the owner's valuation of the seat molds, 1,500 in number. But many, if not most, of these must be for obsolete and low demand products made over the past 40 years.

So, what we have is a declining business in a seriously declining market. And that market decline is a worldwide issue. Yet the business is being offered for sale at a price that was apparently attractive to exactly no one in 2009 when the new motorcycle business had been booming for years. Now that the new motorcycle market has fallen by approximately 50%, the price is exactly the same. This sounds like a fishing expedition but the bait isn't attractive.

[keithl]

Good product, bad company.

[jackson]

Interesting.

In the 2009 article the Corbin business reportedly employed 115 people and was on a three-year slide in both gross revenue and cash flow. Annual sales of new motorcycles in the US market had been averaging close to 1,000,000 for the past 6-7 years. Price: $11.5 million.

In the 2015 article, Corbin employed 90 people and no information on revenue or cash flow is provided. Annual sales of new motorcycles in the US market have been averaging less than 500,000 for the past 6 years. Price: $11.5 million.

In neither case does the price include the real property (land, building, etc.) The price is apparently driven largely by the owner's valuation of the seat molds, 1,500 in number. But many, if not most, of these must be for obsolete and low demand products made over the past 40 years.

So, what we have is a declining business in a seriously declining market. And that market decline is a worldwide issue. Yet the business is being offered for sale at a price that was apparently attractive to exactly no one in 2009 when the new motorcycle business had been booming for years. Now that the new motorcycle market has fallen by approximately 50%, the price is exactly the same. This sounds like a fishing expedition but the bait isn't attractive.

My thoughts, exactly.  No takers after six years on the market says volumes re. the price.

[youcanrunnaked]

Very good analysis, LeRoy. 

Since the sale does not include the real property, the value is in the inventory, seat pans, value as a going concern, and good will.  My understanding is that their seats are made-to-order, so value of the inventory is in raw materials only and is probably low.  Value of the seat pans and as a going concern -- you've already addressed.  it's low.  Value of good will?  Based on Corbin's history of poor customer service, I'd estimate that at a big, fat $0.00.