Holley files for chapter 11 bankruptcy

Easy credit and borrowing for big buyouts and mergers is just as much poison for them as it is for you and me. It has been out of control in this country for years now. In their own words: "It is profitable, but its positive cash flow has for years gone to pay interest on its debt, court documents say." The only ones that get rich in this deal are the bankruptcy lawyers and the principals in the company that drew big salaries. GREED will be the downfall of this country.

Here it is in a nutshell in their words: "The company is asking for a March 19 hearing to consider confirming its Chapter 11 plan. In broad outline, the plan swaps reinstates bank debt, swaps bond debt for equity, and pays trade creditors in full."

These guys will get to own the company: "The Chapter 11 proposal Holley filed along with its bankruptcy petition would give ownership of 90 percent of the company to holders of $146 million worth of 12.5 percent second-lien secured notes due 2009. The second-lien debt holders would also get $50 million in new notes, according to a description of the restructuring plan contained in court documents."

These guys get screwed to the tune of ten cents on the dollar but they were raping them on interest while it lasted: "Bondholders that own Holley's $4.2 million 12.25 percent senior unsecured notes are slated to get either $100 in cash for each $1,000 worth of bonds, or warrants to purchase equity in the reorganized company.

The banks get to get in deeper: "Holley owes $40 million to banks led by Wells Fargo Foothill Inc. It will seek court approval to enter into a new bank loan to fund its restructuring, and has lined up $65 million in bank loans to fund its exit from bankruptcy, court documents say."

The suppliers will be paid: "Holley will pay all general unsecured claims in full, according to an affidavit from Thomas W. Tomlinson, chief financial officer of the reorganizing company."

 

IS the downfall ...

What makes you strong,also makes you weak.

 

Holleys on all my stuff. Work great. They don't seem to work for people who A: have the wrong carb entirely, B: bought a used or otherwise previously ruined piece of junk, or C: can't even tune in a radio station let alone a carb. Now I didn't call anyone names, just pick your category. As for bankruptcy, it can't be all bad for a guy, just follow the guys around in thier new escalades or otherwise high falootin' all black rigs who have owned 15 trucking companies in the past. True, the scum that cheat creditors (and don't lose sleep) need a ball bat from Guido somewhere in the night.

 

I never liked thier products, Weiand was my favorite manifold until they took it over, have not bought one since.

 

The days of " Whats good for GM is good for America " are gone (only the cars remain). Hang on, it's gonna be a bumpy ride for a while.....

 

And its an election year...the perfect storm.

 

Hey guys, my name is Shane Weckerly and I am the Director of Product Management at Holley. I know the “bankruptcy” word sounds bad, but Holley is fine. Please read the official press release below and then our further comments below that.

BOWLING GREEN, KENTUCKY, February 11, 2008 - Holley Performance Products Inc. (the “Company”) announced today that its Owner/Investors have overwhelmingly approved a plan to dramatically enhance the Company’s capital structure by converting a majority of the Company’s debt into equity.

Thomas W. Tomlinson, the Company’s Chief Financial Officer, said today that “This is a prudent financial move on the part of our Owner/Investors – it tremendously strengthens our Company’s financial position and provides substantial flexibility to invest in our future. This investment will allow the Company to realize its full growth potential and will maximize the value we can return to our investors. The actual conversion of debt into equity will be accomplished through a “Prepackaged” bankruptcy filing that will cancel-out the old capital structure and formally establish the new one. Customers, suppliers, and employees will not be affected.” Mr. Tomlinson emphasized that, “It will be “business-as-usual” at Holley throughout the restructuring process which we expect to be completed in as few as 45 days.”

<O</OJames D. Wiggins, the Company’s Chief Executive Officer, went on to say that “We are very pleased with the transformation that has taken place here at Holley over the last several years. Today Holley is a lean and focused enterprise with strong customer relationships, significant technological capabilities, and diversified revenue sources. We have established a good track record of profitability and growth in enterprise value. This restructuring represents the culmination of tremendous effort on the part of the team at Holley and we are excited to share news of this successful program with you.”

<O</OHolley is a leader in the performance engine market, and is used throughout the world in racing, street, marine, and powersports. Holley’s family of companies includes the leading brands in the performance market including: Holley, Weiand, Hooker, FlowTech, Earl’s, and NOS.

<O</OSo, what does this mean to you, the racer/enthusiast/consumer? It means that Holley will be a much healthier company and able to bring you better products, technology and support. This can now be done because we won’t be under the same financial constraints of the last few years.

Essentially, what has happened is that the original investment group will transfer ownership to the second tier of investors who were a minority owner. As a result, the debt we now owe is significantly less and puts us in a better position for the future.

<O</OThis was intentionally structured this way so our vendors, employees and consumers wouldn’t be impaired in any way. It will be business as usual:<O</O

• Product will be available as always with no interruption in supply<O</O
• Race contingency and event sponsorship programs will continue as planned<O</O
• Technical service support via phone, e-mail and at track is unchanged<O</O
• All product warranty systems are continuing as normal<O</O
• New product development is ongoing and we expect to release several exciting new programs throughout the year and at SEMA/PRI.<O</O

Holley has many enthusiasts that work for the company (including myself) that will continue to work hard to bring you good products into the future.

Thanks for your support in the past and future.

Shane

 

Bring back the AA-1!

 

to streetfreakmustang, In wisconsin if he did bounced a check after filing papers he would not be covered for your debt. I would suggest checking out the laws in ohio and see if it is the same, as I think most of these guidlines are federal in nature and you may still be able to haul him into court. I had an asshole with a GM Union paid lawyer string me along for several months promising payment on a debt, then as soon as the papers were filed told me to F+++off. Thats why we line up the lawyers behind the bankes when we shoot them all.

 

actually, thats incorrect. all someone who is in the process of bankruptcy need do in that instance, is file an amendment adding that check to the list BEFORE the bankruptcy is final.

 

Then you are going to the wrong shows.... I see plenty of young kids into all types of stuff... Tuners, muscle cars, drift, classics, customs, and hot rods.

 

I can't remember the exact details but my wife checked into it at the time but she would not win money as the guy bled his company dry of $$ and had already long transfered any of his private assets into his brothers name and 2 of his children. I don't remember the exact chain of events as it happened several years back. She also had to consider her legal fees,time etc and her accountant advised her to write off the $2k.

When you have a small business sometimes you just have to eat it and move on.

 

hey hotrod 392...

i don't think it's business as usual at holley. i bought a 670 2D projection setup for my tow truck and i have been trying to get tech help for 3 weeks now. holley advertises the BEST tech service in the industry but zero response to my inquirys. tried calling and e-mail. 1 time i got a mechanical response to check all grounds and fuel level in the tank. now that's good advice.

i own 3 cars with holley carbs, i think the street avenger is great but i wish i had never tried this injection system. 4000 miles, fuel pump goes out $150; 4800 miles, ecu is bad $350. how about asking your people if they will trade this injection junk for carbs. or at least respond to their existing customers

i know how to tune a carb but i don't get chips...

 

i have a customer that swapped a projection setup in place of the 600 holley i built the car with .....wanting better mileage .....that thing runs like crap...no matter which way you adjust the ecu.....it either idles nice ...or runs good......but not both.... the 600 ran like a scalded dog.... now it just blubbers along.... brandon and i'd take a holley over a edelbrock any day....

 

Most of these companies, after falling behind, are forced into bancruptcy by just one of the creditors suing to get paid. Then everybody has to get their name on the list or get left holding their worthless paper in their hands.

 

Hey Shane FNG,
As I suspected you are a employee or stock holder of Holley. PLEASE do me a favor and quit preaching to the CHOIR.

In each and every bankruptcy its the mom and pop type of suppliers that failed to have secured notes against the company that suffers. Ask me how and I can show you that I have been the GUEST OF HONOR at over 15 bankruptcy hearings in the last 20 years. Add to that a loss to me of over 250K.

To add insult to injury the attorneys filing these type of cases pocket thousands upon thousands of dollars for their services that consist of such bullsh**t as 5$ per sheet to copy paperwork X 25,000.00 sheets and you might get a clue.

By the way did you get stiffed for any of your time? Just as I thought!

 

Maybe they should realize they could produce the Holley 94, sell it for under the $400 that Stromberg is selling theirs for, and sell as many as they could produce.

 

Brandon and Clemdaddy,
Please feel free to PM me your contact information and I will get an EFI tech to call you about your issues. Techs are on the phone and available every day, but can be difficult to reach during peak hours due to increased hold times during certain times of the day.
EFI issues can often be difficult to trace because of electrical issues, plumbing, tank baffling, application, etc. We will work to get you taken care of.

HotRodChassis,
We have had significant discussion on the re-release of the Holley 94's. The big question is would you guys buy the 94's over the preferred Strombergs if they were cheaper?

I appreciate the opportunity to attempt to explain this situation to fellow hot rodders on this forum. I am a FNG on this forum, but have been in this industry a long time as a car builder, hot rod shop owner / manager and as a part of the performance parts business. Stockholder, not likely, just a dedicated employee and hot rodder.

Thanks
Shane

 

That's the bestest idea I've heard in 20 years!!!!

Folks would sure buy 'em... y'all should do a limited run and take 'em to a swap meet and see for yourselves. Or at least put up a site and see how many hits you get...

~Jason

 

Bet the big cheeses (CEO CFO etc) are still doing just fine, and will get their annual bonus bucks anyway.

 

Demand grows. Rebuild kits contain an increasing number of parts that don't work, so there's a demand there, too...just wait'll you install your NAPA kit power valve.
Retro products make sense...Holley has both tradition and respect amongst rodders, and it's been 20 years since Detroit used a carb or a mechanical fuel pump...imagine stopping by the store and picking up a six-pack of fresh new AA-1's...
There's the marketing hook...everyone who needs Ford 2 barrels needs somewhere between several and lots. Sell'em in discounted multi-packs. New Strombergs go from pricey to heart attack when multiplied by 3 or 6 or 8...

 

Shane,

Personally, I remember the Willy's you built-I really liked your Car.

But isn't it kind of funny that all of a sudden these postings are coming on a bunch of Boards (not just this one)telling us that you will be "o.k."? I mean, I understand damage control, but why weren't you folks out here helping us (on Forums) when we have had issues with your products?

 

Thanks for the compliment.

Unfortunately, because we have been very thin on resources for a number of years, there just hasn't been the manpower to keep up with all the forums that have popped up in the last 10 years (there are hundreds...). Our tech dept is kept quite busy with e-mails, calls and faxes.

We are hoping to become more active in the forums in the future as we bring in new help.

Shane

 

Really glad to hear that-

 

Holleys have never had a "shelf life" to speak of, and should ideally be used for racing. I'll run an old Carter AFB or it's modern clone, the Edelbrock 500 CFM on my SBC's. So many of these deals end up dumping on the consumer. It's still a shame that the current market trends take this kind of toll on companies like this one. I still contend that all this shit started back in the early Reagan years with the advent of the new age CORPORATIONS: nothing matters but the profit delivered to the shareholders. Gone are most formerly profitable "mom & pop" operations, and coporate conglomerates have taken their place;..........the rest, as they say, is history!

 

It seems like a love-fest with the Reagan administration these days but I am with you that was the start of the whole mess. Allowing "corporate raiders" to take down old good companies (that made good quality things that last with pride) was criminal. Now they just buy junk from China low and sell it high and to hell with you I've got mine.

 

seem like i keep hearing this more and more.next thing you know they'll be building there carb's oversea's

 

Just a matter of time.
Weber moved carb production from Italy to Spain,
to who knows where now.
And quality has definitely suffered with each move.

But as long as The Suits get their money,they don't care.