Yacht-Maker Fairline Sails To Better Home

The prominent investor Jon Moulton has called in advisers to review options for troubled Fairline Boats, Sky News learns.

A luxury yacht-maker owned by one of the UK’s most prominent investors may be about to set sail in search of new backers.

Sky News has learnt that Better Capital, the private equity group established by Jon Moulton, is working with advisers to explore alternative ownership options for Fairline Boats.

The potential routes open to Better were unclear, but sources said it had asked the professional services firm Deloitte to examine whether Fairline could be sold or refinanced.

Deloitte’s appointment is likely to fuel speculation that more drastic alternatives might also be under consideration, although there was no evidence to suggest that this was the case on Friday.

The news comes at an uncertain time for Northamptonshire-based Fairline, which designs, manufactures and distributes luxury boats through a network of 60 locations around the world.

Founded in 1963, Fairline makes 30ft-to-80ft luxury motor yachts, but lost £17m in 2013 on sales which had slumped by one-third to £56.8m.

It also highlights another challenge for Mr Moulton at a time when he is seeking to find a new chief executive for Jaeger, the fashion label owned by Better Capital.

Sky News revealed earlier this month that Colin Henry was departing as Jaeger’s boss, with reports suggesting that he had fallen out with the company’s owner over its strategy.

Better Capital also announced that Mark Aldridge, who ran the investment firm, was stepping down to be replaced by Simon Pilling, who joined last year.

Fairline has been a troubled investment for Better Capital since it was acquired in 2011, with demand for luxury yachts contracting in the aftermath of the financial crisis.

Under its previous owner, the private equity group 3i, Fairline was loss-making for several consecutive years.

Deloitte also handled a review of Fairline’s ownership in 2010.

The value of Fairline, which competes with rivals such as Sunseeker, has fluctuated under Better Capital’s ownership.

Mr Moulton’s firm said this year it had invested a total of £11.1m in Fairline since acquiring the remaining debt and equity positions from a subsidiary of Royal Bank of Scotland in August 2014.

“The cash injection has been used to fund restructuring and working capital requirements whilst the business completes the transition towards a demand-led manufacturing model,” Better Capital said.

“Alongside a continuous cost review there has been a readjustment of the dealer stocks to the build-to-order strategy and this is nearing completion with underlying demand expected to become more directly aligned with production demand rather than served from dealer destocking.

“Operationally this business is much improved; however, much remains to be done.”

Better Capital said at the time of that update that it remained “committed” to Fairline.

Nine months ago, Better Capital called in administrators at City Link, the courier company, prompting recriminations over its management and sparking calls from MPs as well as Mr Moulton for an overhaul of the UK’s insolvency practices.

A spokesman for Better Capital declined to comment.







Source: SKY NEWS

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