by Jason Epperson
France-based Rapido Group announced today that it was selected as the winning bidder for most of the assets of Roadtrek motorhomes, and has signed a binding letter of intent to enter a purchase agreement as a part of the Canadian receivership process.
Roadtrek owner Erwin Hymer Group North America (EHGNA) abruptly closed earlier this year after it was carved out of a deal to sell parent company Erwin Hymer Group to Thor Industries. Financial “irregularities” found during an audit near the end of the sale triggered a speedy renegotiation of the sale, leaving the Canadian subsidiary that primarily manufactured Roadtreks $300 million in debt and without a parent.
Erwin Hymer acquired Roadtrek in when it created its Canadian division utilizing Roadtrek managers. Unconfirmed reports blamed those executives for the downfall of the company, going as far as alleging embezzlement. To date, those reports remain largely unsubstantiated, and very little information has trickled out a court-supervised sale process. The only clear fact is that the company was in dire financial and that financial reporting painted a much rosier picture.
After the company closed, bids were accepted for all or any portion of the assets owned by EHGNA, and some two dozen companies signed confidentiality agreements allowing them to take a closer look at the assets.
Rapido’s bid was selected as the winner in part because the company plans to assume the lease and restart operations at one of the two Kitchener, Ontario-area factories. Rapido is a small motorhome , selling throughout Europe under the Westfalia nameplate. Their experience doesn’t lie with mass-manufactured vehicles, rather custom smaller-batch conversions. Westfalia was a well-known brand in North America in the 1960s and 70s, primarily as Volkswagon van conversions, and the company hinted that the sale may also bring Westfalia back to North America.
Rapido’s President, Pierre Rousseau, commented that “Roadtrek is a well established leading brand in the B Class segment of the RV market. Our priority will be to re-establish operations and further develop this famous brand in North America.” Rapido expects to hire a workforce that “could grow eventually” to more than 200 and will build about 1000 vehicles a year. Around 850 employees were laid off by EHGNA, many who were hired very recently as a part of an accelerated expansion. A few dozen employees were rehired through the process to keep the factory at an “idle” — ready to restart at any moment. In fact, many orders were in the process of completion, and motorhomes still sit waiting to be finished.
The sale is still subject to “ongoing due diligence” and the execution of a definitive purchase agreement. Of course, it was due diligence by Thor that brought EHGNA’s problems to light in the first place, so there may still be hurdles to jump. But it appears at the moment that Roadtrek may be back soon, perhaps as a bit smaller company.
On the minds of many Roadtrek owners will be whether the company’s 6-year warranty will once again be honored on previously sold vehicles. Rousseau told therecord.com that he intends to honor warranties for vehicles that were purchased prior to the receivership, but it could take months for the sale to complete.