puroagave
Active member
their curent facility is 30,525 SF with about 16k SF of it office space the remainder warehouse/manufacturing space. Its been listed for lease 22 days, it can be vacant in 60-days. Definately looks like they're relocating...
The Future of Audio Research
- Thread starter Mike
- Start date
their curent facility is 30,525 SF with about 16k SF of it office space the remainder warehouse/manufacturing space. Its been listed for lease 22 days, it can be vacant in 60-days. Definately looks like they're relocating...
Mr Peabody
Well-known member
The article answered my questions for the most part. Since Acora was the highest bid I can't imagine the deal not being approved when next step would be going to the next highest bidder.
I guess perception is everything, I was surprised that ARC was only worth the figures given in the article.
I guess perception is everything, I was surprised that ARC was only worth the figures given in the article.
the professor
Well-known member
I know it says that they paid $1.1 million for the assets but that doesn't count all the money they have to put into the company to repair the image of ARC such as giving credit to all the deposits for new orders etc. If there is enough money in "deposit" accounts, as the article says, to pay back the secured debt and make a good dent in the unsecured debt - sounds like that's another million dollars give or take a few hundred thousand plus working capital of probably a couple hundred thousand. To repair their integrity they will also need to take on the liability of all of the warranties. Who knows how much money that could cost?
So in practical terms - the total purchase price is a LOT more than just the $1.1 million.
On a side note - who knows if they are behind in rent. If it's for lease as puroagave states - that might indicate that they have to move.
So in practical terms - the total purchase price is a LOT more than just the $1.1 million.
On a side note - who knows if they are behind in rent. If it's for lease as puroagave states - that might indicate that they have to move.
puroagave
Active member
ARC signed a 10-yr lease in '18 with five years remaining. Its not a sub lease which tells me they are in default and the landlord is taking back the space and marketing it for lease as a direct deal.
Porsche
Active member
looks like the owner had zero clue, shouldn't take 5 years to realize you are doing it wrong. I said it before and will say it again, more to this than has been said
- Thread Author
- #166
Oh boy. So, 2018 was Fine Sounds Group.
Dumb….like a fox!
“Hey, let’s sign one of our biggest competitors to a long term lease for way more space than they need and then dump them.”
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- Thread Author
- #167
Why do you think I dropped them? I couldn’t continue to sell ARC knowing what I knew both factually and in my heart.
This is not a reflection of their great products, Dave Gordon or any of the amazing staff. Just realities of their situation at that time which continue today.
I can sleep at night.
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puroagave
Active member
thats what private equity guys do, rape and pillage then leave a mess for the next suitor. Rondi and Dan lost control of Krell to a PE that buried language in their agreement allowing the financial partners to wrestle control away from the founders. It was a classic hostile takerover.
Michaels HiFi
Well-known member
Buried language? As in the words were hidden that no-one could see except the rapists and pillagers? You mean it was written as clear as day but they signed it anyway either not reading it (unlikely) or read it and signed anyway.
puroagave
Active member
Dan and Rondi sold 40% of the company to a PE firm, and made the mistake of agreeing to a minority position on the board. In short order Dan, Rondi and his son Brett were ousted from the co. He talks about the termination language he (presumably) missed, starts at the 3:20 mark:
Michaels HiFi
Well-known member
I don't care what he claims. Here are the facts:
He either was dumb enough to not hire a lawyer to read the contract (about as dumb a move as you can get), or had bad legal representation. Either way it's 10000% Dan's fault. No rapists in that instance. Just a desperate or dumb seller that willingly signed a contract that the buyer then followed and did as the contract said was allowed. It's not the buyers fault the seller was willing to sign.
Dan is not a victim - he's just a bad businessman. Don't blame the other guy for acting on what Dan willingly signed (unless you're claiming he was forced to sign at gunpoint). It was DAN's CHOICE to sign.
a.wayne
Well-known member
Right or wrong like him or hate him , the push back to defend Dan is understandable, he was shafted by what many audiophiles would consider an unethical outsider , fortunately Dan has more than made up for his Krell Ousting , hi-end audio is a cottage cheese industry, everybody is known , everything is personal, there is very little to no Fortune 500 mentality in these boardrooms , if so not even a weapons grade level fool would invest, its all emotional and touchie feely stuff , sadly Brent is not amongst us today to see how Dan has survived it...
Regards
Regards
Michaels HiFi
Well-known member
I don't know Dan personally and have no feelings towards him one way or the other.
I agree with many of your points.
Nothing shocking or unusual at all. An owner may create a separate entity/company to buy the building and lease it to the first company. Done all the time. Heck, some owners go as far as creating a third company that owns the equipment and leases it to the first company.
Mr Peabody
Well-known member
If things went down at Krell like that, I wonder why Rondi stayed.
Michaels HiFi
Well-known member
At Krell Dan and Rondi were not very smart. They ran out of money. They brought in an outside investor. They retained 60% ownership but gave the investor a MAJORITY number of seats on the board (DOH!). They ran into more money issues. Boom - they were out. There was no raping as has been suggested.
Mr Peabody
Well-known member
I read your post and although you replied with quote you didn't read mine. No need for you to reiterate what you already said. Rondi stayed with Krell, my question was, why, if she was "out" and things were hostile take over would she stay.
Michaels HiFi
Well-known member
Hey -sorry. I did read your post. I meant to simply hit the reply button as I was adding more info I read about on the legal briefing sites about the case.
puroagave
Active member
Did you read the complaint? I've seen the abstract, this is just part of it:
"STAMFORD, CONN. — Krell founders Dan and Rondi D'Agostino have filed a lawsuit here against private-equity fund KP Capital Partners and current KP-allied Krell executives to regain their management roles at the high-end audio company they founded in 1980.
In their lawsuit, the founders contend they were locked out of the company's Orange, Conn., offices about three months ago in violation of their employment agreements after trying to assert their right to fire a KP-backed executive. They also contend that KP used “fraudulent, overreaching and unconscionable tactics” in “a scheme to usurp the assets of old Krell [owned 100 percent by the D'Agostinos] at a discount, and exert complete control of new Krell, despite only purchasing a minority ownership interest.”
Michaels HiFi
Well-known member
I actually read the FINDINGS of the Judge of the original contract they signed, what is stated and gave each party, and the facts of what happened and the financials - not just a complaint which is a one sided story telling.
Not just the complaint which is merely an unchallenged (in it's initial written form which you quoted) story telling exercise.