The old Genmar boat factory in Little Falls will keep its engines running, saving about 170 jobs, after its new owner finalized $1.85 million in loans from a group of community and state lenders.
Group floats Jacobs loan for boat factory
The deal allows the entrepreneur to proceed with his purchase of the old Genmar operation in Little Falls.
February 12, 2010 at 6:16AM
The deal closed Wednesday, allowing Irwin Jacobs' J&D Acquisitions to buy the Little Falls factory from the private equity group that bought Genmar Holdings out of bankruptcy in January. J&D Acquisitions put $5.55 million into the deal, bringing the total package to $7.4 million, according to the Initiative Foundation, a Little Falls nonprofit that put $500,000 into the $1.85 million loan.
"This is excellent news," said Sandy Voigt, a manager at the foundation. "They're a major employer in Morrison County."
The $1.85 million market-rate loan came from the Initiative Foundation, the Minnesota Department of Employment and Economic Development's Minnesota Investment Fund, the Economic Development Authority of the City of Little Falls, Community Development of Morrison County and the North Central Economic Development Association Inc.
The plant, 11 buildings on 57 acres, makes Larson, Seaswirl and FinCraft boats and employed as many as 800 people a few years ago.
Boatmaking has been a key part of the central Minnesota city's economy -- and it's taken a hard hit. Brunswick Corp. of Lake Forest, Ill. -- one of the world's largest recreational boatmakers -- runs a factory in Little Falls on the other side of the Mississippi River from the former Genmar factory. It announced last week that it's closing that plant by autumn and moving production to other locations, including New York Mills, Minn. Brunswick's plant makes Crestliner and Triton boats. About 180 production jobs will be lost in that closing, although Brunswick is offering transfers to about 90 workers.
"We're losing 180 jobs on one side, we're keeping 170 on the other," Voigt said.
The plant's future was questionable after its previous owner, Genmar Holdings, filed for Chapter 11 bankruptcy in June. In January, a Beverly Hills private equity group, Platinum Equity, bought Genmar for $70 million at a bankruptcy auction.
But Irwin Jacobs, Genmar's former chief executive, bought back chunks of his old company as part of a 50-50 joint venture between Hopkins-based Jacobs Trading -- which Jacobs also runs -- and hair-care mogul John Paul DeJoria called J&D Acquisitions. The Larson, Seaswirl and FinCraft boat brands, manufactured at the plant in Little Falls, are part of a collection of Genmar assets that J&D Acquisitions acquired for an undisclosed price.
Jennifer Bjorhus • 612-673-4683
None of the boat’s occupants, two adults and two juveniles, were wearing life jackets, officials said.
