The news dominating the aftermarket as this edition of AMD Magazine went to press was of Kuryakyn becoming an in-house Tucker Powersports brand rather than a standalone vendor . The Kuryakyn origin story predates its founding by around 25 years and is one that is intimately involved with the Drag Specialties back story . Kuryakyn was the brainchild of founder Tom Rudd and was his parts and accessory industry comeback vehicle after he had sold his Drag Specialties business to a private equity investor before Fred Fox bought it out of insolvency . It was at the height of the hype and the unsustainable growth of the late 1990s and early 2000s that the Motorsport Aftermarket Group ( MAG ) project started to take shape with acquisitions that included respected market leaders such as White Brothers , Progressive Suspension , Performance Machine , Mustang Seats , Vance & Hines , and , along the way , Kuryakyn . The original vision that MAG creator Arnie Ackerman and his San Francisco based Duff Ackerman & Green ( DAG ) business partners had , was to cherry-pick the aftermarket and build a boutique line-up of the best brands , in what was , for the time , an enlightened and benign approach to an otherwise notoriously inconsistent and poorly defined private equity ' Build & Hold ' culture back then . Not all the projects that MAG invested in went well ( White Brothers for example ), and not all the founders decided to visit the bank and still stay involved - but most did - including Tom Rudd who , by then , was one of the single most experienced players in the aftermarket - in the 1960s Rudd had been one of the pioneers of opening up access to parts manufacturing factories in Asia , most notably in Taiwan . The basic MAG concept was robust - provided the seemingly inexorable growth in the custom motorcycle parts and accessory market continued , then DAG would be able to continue to service the debt mountain it built up to buy the businesses before then flipping it . However , therein lay the flaw , the historic weakness in the strategy , and one which would repeat and repeat again . The growth of the late 1990s through to the mid-2020s was a paper tiger . It really was unsustainable . It was growth based on the quicksand of equity release fueling middle America ' s spend on its toys . Consumers in the United States ( and elsewhere ) were using their homes as ATMs and cashing in their apparent property profits using unsustainable and unsustainably complex loan products . The heat in the housing market literally melted the banking system in 2007 and , all of a sudden , almost overnight , none of us were going to the bank anymore . Leveraged businesses like MAG found themselves stranded above the tide line as consumer confidence and spending evaporated . DAG sold its position in MAG to Los Angeles based equity investor Leonard Green & Partners ( LGP ), but the deal they did rapidly went from viable to troubled asset status . LGP limped on as owners for some five years or so before along came the then owner of Tucker Rocky - Lacy Diversified ( LDI ). They thought they were buying at the bottom of the market , they were not . They thought that a tall , integrated , metal to motorcycle business model could work , it could not . Already now double leveraged with debt ( DAG , LGP ), Indianapolis based LDI , who had already been owners of Tucker Rocky for some 15 years or more at that stage , mortgaged
many questions still to be resolved
their TR assets to acquire MAG . LDI tried to pass it off as a merger , but either way the group found itself straddled with a third drink from the well of debt just as the market took another dump . Fast forward to MAG ' s emergence from its bankruptcy filing in late 2018 , and the private equity consortium that acquired MAG / TR ( Contrarian , Monomoy and Blue Mountain ) found itself in the exact same position as those who had come before them . Sales across the board - from Kuryakyn and the other MAG ' brands ' through to the newly badged Tucker Powersports and the whole of the rest of the aftermarket - did not play out as had been hoped . That led to the great MAG ' unwind ' with it all but disappearing as a corporate entity in order to save money and , above all , streamline business unit reporting straight to the investor consortium ' s appointed board . Former Harley man Marc McAllister has managed to stabilize Tucker , return it to profit and , counterintuitively , return it to growth as the unexpected Pandemic Part II story has played out . Meanwhile , the ownership trifecta has had to be aware of their responsibility to their own investors . The received wisdom was that they would listen to the right offer ( for any or all of the business units ) if there were interested parties . The word is that this past summer a deal to acquire Kuryakyn collapsed at due diligence stage . With no alternate suitors on the horizon , the decision has been taken to fold the Kuryakyn assets ( IP , inventory , R & D , receivables , dealer accounts etc .) into Tucker - where it will sit inside a crowded ' House of Brands ' alongside the likes of Twin Power , Biker ' s Choice , Tucker V-Twin and many others . The decision leaves a lot of careers and livelihoods in tatters in Wisconsin , of course , which is always a heartbreak . But it also leaves many questions still to be resolved - not least the status of Kuryakyn ' s agreements with other distributors in the United States and internationally . However , from the owner ' s perspective , if the business was continuing to see sales decline , to haemorrhage money and fail to generate its own investment capital , then the solution is a good one - an elegant one in fact . Marc McAllister has done a good enough job , and , above all , quickly enough , to make it a viable option - that is no small thing . As recently as 24 months ago , it would not have been feasible . While there is work to be done to reignite the new product furnace that has always been how Kuryakyn sales were fueled , there is no doubt that , in the long run , this decision has the potential to be a very good one for Tucker ' s balance sheet - a very good one indeed .
Robin Bradley
Co-owner / Editor-in-Chief robin @ dealer-world . com