15 replies to this topic

[Roger Clark]

It was anounced today that Reynard has gone into receivership. Job losses will apparantly number over 100, and although the company will continue to run under the managment of the receivers for the time being, the future must be bleak. They achieved much in all forms of racing except formula 1. This is a black day for motor racing.

[Ross Stonefeld]

I was surprised at the numbers. Debt is liek 3mil or something? For startesr where did he lose all this money, and how hard can it be to get 3mil. Those Indycar chassis are a couple hundred grand. And I suppose its not smart business to use your own money to help you through the dark patches...

[Rainer Nyberg]

Yes it feels quite strange, when you think about the domination of the CART-grids during the latter part of the 1990s. But Lola was also in trouble just a few years ago and they recovered, so should a great trademark like Reynard.

[Roger Clark]

Originally posted by Ross Stonefeld
I was surprised at the numbers. Debt is liek 3mil or something? For startesr where did he lose all this money, and how hard can it be to get 3mil. Those Indycar chassis are a couple hundred grand. And I suppose its not smart business to use your own money to help you through the dark patches...

The largest single creditor is Adrian Reynard.

[Doug Nye]

Hmmmm... Bright cookie. Watch that space......

[rdrcr]

Ross, Falcodore and I were just discussing this a while back in chat... We thought that it would be suitable for a large manufactured to take over Reynard for an in-house R & D dept.

It may still happen. I doubt that the assets will just be sold off without some some sort of restructuring or acquisition crafted by Mr. Reynard.

[BRG]

There were some rumours on this BB (emanating from the USA) that this was on the cards. But I put them down to some sort of hostility over the BAR debacle. Seems like I was wrong, however.

There seems to be a cycle with volume racing car manufacturers - March were dominant in F2 and F3 and then in CART. But they were blown away by smaller, more flexible competitors like Lola (CART), and Ralt (F3) and March was no more. Lola were in turn defeated by Reynard in CART and as we know, collapsed as they tried to enter F1. Ralt were squeezed out of F3 by Dallara and disappeared (until this year when they re-emerged). And now Reynard in turn go to the wall.

In theory, being a constructor in several formulas should be safer. If you build a poor model one year in, say, F3, you have F3000 or CART or sports-cars to fall back on when the F3 teams desert you the following year. But it does nto seem to work that way. Maybe the smaller specialists like Van Diemen, who stick to what they know best, F. Ford, have got the right idea. I will be interested to see if Dallara go the same way as March, Lola and Reynard as they are not just in F3, but IRL as well.

In the interests of the British motor racing industry, I hope that there is someone to rescue Reynard, as Martin Birrane rescued Lola.

[Ross Stonefeld]

Originally posted by rdrcr
Ross, Falcodore and I were just discussing this a while back in chat... We thought that it would be suitable for a large manufactured to take over Reynard for an in-house R & D dept.

That dirty...

we came up with that idea before you came in


I really hope REynard come out of this okay, even if they have to start over. Their my fav mfg, i led my first laps in one of their cars, etc etc

[rdrcr]

Originally posted by Ross Stonefeld
[B]

That dirty...

we came up with that idea before you came in

a most ungracious comment my back-marker buddy.... IIRC that was my idea and out of the kindness of my heart, I included you and Falcadore in this thread... and this is how you repay me?



From Motorsports.com:

"... Reynard Motorsport has today announced that the company has been placed in receivership with immediate effect. Recent efforts to recapitalise the company did not reach fruition and without further financial investment the company had no alternatives available.

Staff losses will number over 100 people, although the company will continue under the management of receivers for the immediate future. The company has trade creditors of over £3m, in addition to Adrian Reynard, who is substantially the company's single largest creditor.

Adrian Reynard, founder and Chairman, Reynard Motorsport, said of the decision, "It is the worst day of my business life and in the history of the company. Reynard has had so much success over the last three decades and I'm devastated that it has ended this way, but we had no choice."

Reynard adds, "It has been a combination of factors which has led to our situation today. Our aborted float on the US Stock Exchange, which put a strain on our financial resources, and the subsequent changes in the US autoracing market are just some of the influences on the downturn in fortunes of the company. Reynard has suffered from several management changes and strategy shifts over the past three years and it eventually found itself in two of the wrong market places at the wrong time, having invested huge amounts of money in those products. I had hoped that we could retrieve the situation, but sadly we were not able to achieve this..."

From Speed:

"... The long-rumored and oft-denied financial woes of British car manufacturer Reynard finally came to a head Thursday as the car maker was officially placed in receivership after Adrian Reynard failed to find a buyer for the company.

English courts had given Reynard until the end of March to find someone to help alleviate the nearly $5m in debts owed to banks, but when no solid prospects materialized Reynard decided not to delay the inevitable.

"It is the worst day of my business life and in the history of the company," Reynard said. "Reynard has had so much success over the last three decades and I'm devastated that it has ended this way, but we had no choice."

The news had been filtering through the Champ Car landscape for the last few months and was first reported in the media by Forrest Bond’s RaceFax, and some of Reynard’s CART teams had gone as far as to start testing Lolas as worry over support and new parts started to appear.

The company statement allowed that it will continue to run under the guidance of the receivers at least for the short term. There are already interested parties lining up to pick over the pieces of the company, including its seven-post shaker rig and its wind tunnel complex.

"It has been a combination of factors which has led to our situation today," Reynard explained. "Our aborted float on the US Stock Exchange which put a strain on our financial resources, and the subsequent changes in the US autoracing market are just some of the influences on the downturn in fortunes of the company.

"Reynard has suffered from several management changes and strategy shifts over the past three years and it eventually found itself in two of the wrong market places at the wrong time, having invested huge amounts of money in those products. I had hoped that we could retrieve the situation, but sadly we were not able to achieve this."

The company, which was founded 29 years ago, enjoyed huge success since coming to CART in 1994, and has won the last seven constructors championships. Reynards have won 91 CART events including a stellar 18 in each of the ’98 and ’99 seasons.

But the tide started to turn this year as the majority of the teams in the series are running Lolas, the first time since 1996 that Lolas have had more entrants than the Reynards.

The company was further hurt by the inability to gain recent contracts in the field, including the Indy Racing Infiniti Pro Series deal which went to Dallara. It did get the contract for the Premier GP cars, which were to be run in alliance with some of the world's top soccer clubs, but the company suffered a hit when the series was pushed back a year..."

Seems that the earlier 3m figure was a bit shy according to the press report by Speed's reporter Eric Mauk. The IPO in the late '90s was disaster, it's costs an estimated 600 - 800k to have the underwriters support an IPO, plus have your financial status come into compliance... Also the debt coupled with the apparent, ever changing management has lead to this move by Mr. Reynard.

Being a private company, I don't know where one can get the actual info on Reynard's debt to equity ratios, cashflow and other financial material. I'd like to assume that he filed for protection so that some sort of reorganization could be attempted.

[ReWind]

Like so often: Looking for something else I stumbled across this.

It should be interesting to anyone who wants to know details about Reynard Motorsport Inc. or the fiscal side of motorsports in general.

Ever wondered what Adrian Reynard’s salary was? Look there!

[Stoatspeed]

Distressing news for Reynard and for "Britain plc" in general ...
I remember visiting Reynard in their early days and having our guide explain the fact that even then there were "companies within companies" dealing with different parts of the manufacturing process ... all transferring money as work progressed. Later on, I came across the same approach to business in the empire of a certain stocky Scotsman ..... and we know what became of that sorry mess!
Sometimes it seems these entrepreneurs get a little too clever for their own good and forget to notice that revenue is required to keep everything turning. Hopefully it will all turn out OK, but the idea of a major company buying into Reynard as an R&D arm might be fanciful - who's left in th UK who might do this? (the topic of several other active threads on TNF.... )

Dave

[petefenelon]

Originally posted by Stoatspeed
Distressing news for Reynard and for "Britain plc" in general ...
I remember visiting Reynard in their early days and having our guide explain the fact that even then there were "companies within companies" dealing with different parts of the manufacturing process ... all transferring money as work progressed. Later on, I came across the same approach to business in the empire of a certain stocky Scotsman ..... and we know what became of that sorry mess!
Sometimes it seems these entrepreneurs get a little too clever for their own good and forget to notice that revenue is required to keep everything turning. Hopefully it will all turn out OK, but the idea of a major company buying into Reynard as an R&D arm might be fanciful - who's left in th UK who might do this? (the topic of several other active threads on TNF.... )

Dave

"Companies within companies" was standard practice though; Chapman's setup was baroque in the extreme, too, as early as the sixties, and Black Jack was careful to separate MRD and BRO. Even March started to head that way in the 80s.

Somewhat surprised at the disparity in compensation between Reynard and Gorne, and how low Paul Owens' basic salary was. And if they're the only people making over $100k out of the company, how badly paid were the senior to mid-level designers and engineers?

As an aside, Adrian Reynard paying himself about $8m does make Reynard's treatment of its graduate apprentices (pocket money and a room to doss in) seem a bit cruel... but there was always an excess of demand from candidates over supply of places....

[petefenelon]

Originally posted by ReWind
Like so often: Looking for something else I stumbled across this.

It should be interesting to anyone who wants to know details about Reynard Motorsport Inc. or the fiscal side of motorsports in general.

Ever wondered what Adrian Reynard’s salary was? Look there!

Fascinating discovery, many thanks. As the good Dr Lawrence says, "follow the money".

[Gary C]

funnily enough, in this months' 'Flypast' magazine (old aeroplanes, don't ya know), there is a small piece saying that a Folland Gnat has been restored to static display status and will be used as a gate guardian out of the front of the Reynard Factory!! I'm presuming it's the same company?.....

[David M. Kane]

I can assure you Adrian won't being going off to the poor house...He's been planning for this day for a long time. I happen to own 91D/3 if anyone one would like to buy it...

[ensign14]

Originally posted by petefenelon


"Companies within companies" was standard practice though; Chapman's setup was baroque in the extreme, too, as early as the sixties, and Black Jack was careful to separate MRD and BRO. Even March started to head that way in the 80s.

Still is. If one area goes tits up why bring down the rest of the empire? Particularly in companies at the cutting edge, where a failure can have disastrous knock-on effects, e.g. the medical field. Separate companies for separate drugs/IT systems/advice centres so that if they get the cure for malaria wrong the one dealing with the common cold can continue.