American Motorcycle Dealer AMD 248 March 2020 | Page 31

Robin Bradley Publisher [email protected] T he 2020 Tucker Powersports Dealer Expo at Fort Worth, Texas, in January was revealing - it reflected the issues that the company is faced with following the MAG "Unwind" but, in equal measure, also reflected the determination of new CEO/President Sebastian Bretschneider and his "Stronger, Focused Leadership Team" in tackling the issues and getting the "House of Brands" back on track… The decision to "unwind" from Motorsport Aftermarket Group (MAG), taken last year by the Monomoy Capital Partners appointed board, has been widely applauded. When the V-twin parts and accessory industry was experiencing record growth in the late 1990s and early 2000s, the MAG concept, developed by San Francisco based investment management house Duff Ackerman and Green, was an essentially sound one - namely to bring together market- leading aftermarket brands on a shared management and capital basis. However, it did not survive the economic downturn and ever since there has been a scrabble to make sense of a one-time critical mass that had become a liability. www.AMDchampionship.com Ownership transitioned ultimately to a consortium of three private equity investors - Blue Mountain Capital Management, Contrarian Capital Management and Monomoy Capital Partners as lead/managing investor - who set about rebuilding the trading structure and management teams at each of the individual business units. The vertical integration concept had clearly failed - deemed not suitable in a declining and relationship-based market. In what AMD described at the time as the powersports industry's "ultimate mic drop," Monomoy and MAG CEO Hugh Charvat embarked on a big unwind, eliminating the entire MAG management level, overhead and structure and restoring direct-to-board reporting and decision making to each of the individual business units. "No longer are we conducting brain surgery wearing boxing gloves," as one of the company presidents put it to me recently. Having now met three of the company presidents concerned, it is quite clear that the ability of each of the group's businesses to steer their own fortunes is now much enhanced, and in the case of Tucker Powersports, the 'tough love' 'tough love' that CEO and President Sebastian Bretschneider has been hired to deploy, will return Tucker to being an effective competitor for the market's leading distribution businesses. It is already yielding results. The process of "unwind" proved to be a great deal more expensive and Sebastian Bretschneider, CEO/President: "The process of the MAG "unwind" proved to be a great deal more expensive and complex than anticipated." AMERICAN MOTORCYCLE DEALER - MARCH 2020 31