Takeover of Fora Marine: The difficult question of down payments on yachts on order

RM Sailboat under construction

Since the takeover of Fora Marine by the Grand Large group, the shipyard's management has been faced with a major issue: the management of the RM yacht order book with the former owners. Between customer testimonials and response from Stéphan Constance, co-founder of the Grand Large group: a look back at the situation.

Numerous RM yachts on order

Although the financial health of Fora Marine, the builder of the RM yachts, necessitated its receivership and led to the takeover by the Grand Large group, its commercial situation was good. At the time of the sale, the order book showed 28 boats and 25 customers (some professionals were waiting for several units). " RM's drama is its commercial success! "explains Stéphan Constance, co-founder of the Grand Large group. " This is a new situation, because usually when you take over a company that is going badly, there are almost no customers left. When we took over Garcia, there were no more customers. "

Customer down payments permanently lost

Although the Grand Large group took over the yard, it did not take over the debts. " It was impossible to take over the clients' contracts. We said so in court. That would have led us to refile in a few months. " sums up Stéphan Constance. However, down payments made by customers remain with the company. Depending on how far the construction of the yacht has progressed and on the negotiations during the contract, up to 50% of the price of the finished boat is paid. They represent a total of 2.1 million euros.

Fora Marine offers a discount on a new boat

For customers engaged with the former management, the yard offers to reorder a new RM under special conditions and with priority over delivery. A commercial discount corresponding to a percentage of the deposit paid is applied on the last published price list in October 2019. According to some customers, the initial proposal was 22% of the down payment. It is now 50% of the down payment, according to Stéphan Constance. " The order has to be reordered because there was no longer any legal link after the bankruptcy. It is done on the basis of the last valid price list. The good news is that there is no increase. The bad news is that it can be more expensive than the first signed tariff, depending on the commercial discounts obtained or the initial date of purchase of the boats. But on our side, we cannot assume the inconsistent prices that led to the bankruptcy. It's a dramatic situation with clients who have made large down payments just a few days before the bankruptcy, but we are still putting 1 million euros on the table: 500,000 euros corresponding to the buy-back of work in progress and 500,000 euros in commercial discounts brought in by the Grand Large group. "

Sailing dreams to review

In its takeover press release, Grand Large indicated that it attached particular importance to customer relations. The reception of its proposal appears to be very mixed. " It goes from "Great. Thank you" to physical threats. Order confirmations are in progress and other situations are humanly more complex. We have set a rule that is meant to be objective, without analyzing individual cases, with an effort proportional to the loss encountered ", sums up Stéphan Constance.

For customers who have contacted BoatIndustry, the analysis is drier. The owners' forum has seen many reactions and foreign clients are getting organized with lawyers. " It is a legal practice, but we are asked to buy back a boat that will ultimately cost us for some 1.5 times its original price. Personally, I think I will decline the proposal. It makes no sense to buy a boat that expensive. Maybe I'll think about it from time to time " sums up one client.

Another testifies to the end of his dream: " I'll let you imagine all the steps you go through when you put a good part of your savings into a boat that was the culmination of a dream for our family. Alas, our circumnavigation of the world will not come true, as the buyers have decided to increase their prices considerably and to recover only a part of the down payments made. We will not be able to follow. "

If the recovery equation is still complex, let's hope that the yachtsmen left behind will really allow Fora Marine to get back on the right side. Let us recall that the recovery project sets a target of 14 boats for the month of August 2020.

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