GILROY
–– It’s been two-and-a-half weeks since the deadline to bid on
Indian Motorcycle’s trademarks and factory, and there is still no
winner.
Indian probably won’t have a new owner before the end of this
week, company Chairman Frank O’Connell said Monday. Some or all
seven bidders are now upping their offers in a second round of the
auction. O’Connell wouldn’t say how many bidders there are.
GILROY –– It’s been two-and-a-half weeks since the deadline to bid on Indian Motorcycle’s trademarks and factory, and there is still no winner.
Indian probably won’t have a new owner before the end of this week, company Chairman Frank O’Connell said Monday. Some or all seven bidders are now upping their offers in a second round of the auction. O’Connell wouldn’t say how many bidders there are.
“It’s pretty active,” O’Connell said. “The bids are definitely up…substantially.”
As for the delay, O’Connell said Indian and its liquidation agent, Credit Managers Association of California, wanted to give the bidders enough time to carefully review their and Indian’s finances and arrive at a final offer.
“We’re making it very clear that this is it,” O’Connell said.
One of the reasons the auction has taken so long is that the seven original bids were not all for the same package of assets. Some bids were for the Gilroy factory only, some were for the trademarks only, and some were for both.
For the second round, Indian is not requiring companies to bid on the same thing. If it makes more money to accept one bid for the factory and another for the trademarks, CMA would do that, O’Connell said.
“CMA’s job is to best represent the creditors,” O’Connell said.
As well as being Indian’s chairman, O’Connell is also its second-leading stockholder, after the Boston-based investment firm Audax Group. Stockholders will get no money from the auction unless the sale amount is enough to pay off Indian’s massive debts with money left over.
On Nov. 1, O’Connell and his wife organized and bankrolled a media event and a series of nationwide rides to “galvanize grassroots support” for the Indian brand.
In the Bay Area, there wasn’t much response. About 18 riders, including four from Gilroy, crossed the Golden Gate Bridge without the news coverage they were hoping for, according to Gilroy Indian dealer Don Nofrey, who did not attend.
Nationwide, attendance was “great … everything we expected,” but media coverage was hard to come by, according to event spokesperson Stephanie Blank. Gov.-elect Arnold Schwarzenegger, who rode an Indian in the third “Terminator” movie, was invited to the press conference in Los Angeles but did not attend.
Indian closed its Gilroy factory without warning Sept. 19, laying off about 380 employees.
The two known bidders for Indian’s assets are Bill Melvin, a retail liquidator and motorcycle collector from Michigan, and Matrix Capital. Matrix’s frontman, Rey Sotelo, was a bike builder in Gilroy who became Indian’s first president and CEO when it came back to life in 1998. He resigned in 2001.
