Large Scale Central

Possible negotiating snags regarding Märklin LGB® in NA

General Discussion
#1

Hi all,

Snag#1: G45/LGBoA’s part just prior to and during the insolvency.

Snag#2: Product lines represented by LGBoA. Märklin and PIKO from the same distributor? Possible, but highly unlikely. People have long memories!
Märklin sued PIKO over the HO ICE. Märklin contended that it was a straight copy. The judge ruled since the PIKO model was supposed to be true to prototype it had to be pretty well identical to Märklin’s model (paraphrased!). BTW this one was all over the European hobby press and the talk of the industry. But nobody translated. :stuck_out_tongue: :wink: :lol:

Snag#3: Duplication!

Snag#4: Statement by Rolf Richter as to the reasons why LGBoA was transferred to G45 i.e.

RRichter.translated by HJ said:
…
In addition was the sale of the American subsidiary LGB of America, a source of potential losses, to an American corporation along with comprehensive agreements regarding the longterm future cooperating partnership. Despite the substantial liquidity achieved through this all accounts of EPL remained frozen.
…

Sooooooooo that looks like a two for one deal i.e. those partnership agreements (longterm future!!!) and potential losses. In most peoples minds this will relate to liquidity.

Snag#5: Assets and resources.

Snag#6: Actual ownership.

Disclaimer: This is strictly my opinion. Please keep in mind that

a) I’m not a salesman.

b) I have no inside information from either Märklin or LGBoA

c) my sole interest is in: How interesting life can be and how much one can learn from it each single day.

:wink: :slight_smile: :wink:

#2

HJ-
…and others with continued interest in the singular intriguing news in large scale:

There, in Richter’s own words (via transalation)is the key: LGB of Germany SOLD the subsidiary LGB of America to G-45 ( I guess). “Sold” to me means money and so does the translation “substantial liquidity.”
If this is accurate, what’s the issue? The money is being held? Or does Marklin now have it? If they do, are they in agreeing to a “no contest” with LGB of America – either in terms of what the amount was and the agreement of sale? If agreement, then LGB of America may be a legit entity! Now, that would be an amazing pull-off by the pre-bankruptcy tweekies. If so, what a blast for the legal eagles at USC’s law school. Let the mock trial begin – try my classroom first, please!

Meanwhile, “SOLD” is NOT stored, transferred on credit, biz enchange for comparable goods or services, time payments, etc. Wait, there’s a gimmick!!!

THE question: Then where does Marklin’s ownership of LGB start, operate, and end??>??

IF an American corporation pulled off selling a subsidiary DAYS BEFORE declaring bankrupcy, the profits would be declared part of the corporate holdings. Period. The gambit of “raising cash to stave off a bankrupcy” would NOT fly. So use of “sustantial liquidity” is a common expression for cash. Oooops, is that what Richter had in mind? Hmmmmmmmmmmmmmm… Now, what WAS sold? Merchandise? The name? If the name then what does Marklin own – only the name of an animal as long as it remains in Europe? When it reaches American soil will the identical product be known by a different brand name? Would Marklin be so stupid to agree to any such caveat re: possession of LGB? If so, do they see Europe THE market for large scale trains - forget the U.S. and leave it to Aristo and USA? I doubt it.

Meanwhile patent attorneys here will have a field day sorting this one out.

Hans, my guess is you have much stored in your cranium!
Anything else you can offer?

This is good stuff!
Selah,

Wendell

#3

HJ-
…and others with continued interest in the singular intriguing news in large scale:

There, in Richter’s own words (via transalation)is the key: LGB of Germany SOLD the subsidiary LGB of America to G-45 ( I guess). “Sold” to me means money and so does the translation “substantial liquidity.”
If this is accurate, what’s the issue? The money is being held? Or does Marklin now have it? If they do, are they in agreeing to a “no contest” with LGB of America – either in terms of what the amount was and the agreement of sale? If agreement, then LGB of America may be a legit entity! Now, that would be an amazing pull-off by the pre-bankruptcy tweekies. If so, what a blast for the legal eagles at USC’s law school. Let the mock trial begin – try my classroom first, please!

Meanwhile, “SOLD” is NOT stored, transferred on credit, biz enchange for comparable goods or services, time payments, etc. Wait, there’s a gimmick!!!

THE question: Then where does Marklin’s ownership of LGB start, operate, and end??>??

IF an American corporation pulled off selling a subsidiary DAYS BEFORE declaring bankrupcy, the profits would be declared part of the corporate holdings. Period. The gambit of “raising cash to stave off a bankrupcy” would NOT fly. So use of “sustantial liquidity” is a common expression for cash. Oooops, is that what Richter had in mind? Hmmmmmmmmmmmmmm… Now, what WAS sold? Merchandise? The name? If the name then what does Marklin own – only the name of an animal as long as it remains in Europe? When it reaches American soil will the identical product be known by a different brand name? Would Marklin be so stupid to agree to any such caveat re: possession of LGB? If so, do they see Europe THE market for large scale trains - forget the U.S. and leave it to Aristo and USA? I doubt it.

Meanwhile patent attorneys here will have a field day sorting this one out.

Hans, my guess is you have much stored in your cranium!
Anything else you can offer?

This is good stuff!
Selah,

Wendell

#4

Wendell,

Your assistance is needed!! When a company gets in trouble here, do the banks put a obsever in the company?? If so what does the obsever do?? They said that there was a obsever in EPL for a # of years… Would he have the power to authorize the sale of LGBofA for cash?? Would he have the power to move inventory, say to LGBofA for cash?? If he did this would the banks have any recourse??

#5
Bob Burton said:
Wendell,

Your assistance is needed!! When a company gets in trouble here, do the banks put a obsever in the company?? If so what does the obsever do?? They said that there was a obsever in EPL for a # of years… Would he have the power to authorize the sale of LGBofA for cash?? Would he have the power to move inventory, say to LGBofA for cash?? If he did this would the banks have any recourse??


Bob,

Has anyone ever mentioned which bank that observer was affiliated with? :wink: :confused: :wink:

#6

Bob,
If one were to listen to the ‘masters of spin’, then no financial problems plagued Lehmann, right up to the moment the ‘evil’ banks stepped up to the plate ‘resulting in Lehmann declaring insolvency’. Now if there were no problems at Lehmann prior to mid-2006, then there would hardly be recourse for the banks to place an insider to keep an eye on things.

Of course ‘liquidating assets’, by way of ‘transfer’ would certainly stir the pot just prior to declaration of insolvency and attract the attention of the banks. Considering the financial state of accounts in mid-2006, were Lehmann in a legal position to actually dispose of assets?

#7

Without getting into details, there are only 2 major sticking points. The rest have been resolved.
Point 1: Mentioned by HJ, Piko.
Point 2: Who is going to pay for warranty work on product manufactured prior to Marklin’s takeover.

Neither is insurmountable and when the details are worked out we will have an announcement from both parties involved. Anything else is just stirring sh*t to see how much stink can be raised.

I’ll not convey any further information.

#8

One would assume that Marklin would make good on the warranty. When you buy a company, you get the assets as well as the liabilities. Even if that were not so, it is just good PR to do so. Keeps the customers happy. Happy customers buy more toys. Duh! :lol:

#9
Warren Mumpower said:
Without getting into details, there are only 2 major sticking points. The rest have been resolved. Point 1: Mentioned by HJ, Piko. Point 2: Who is going to pay for warranty work on product manufactured prior to Marklin's takeover.

Neither is insurmountable and when the details are worked out we will have an announcement from both parties involved. Anything else is just stirring sh*t to see how much stink can be raised.

I’ll not convey any further information.


Point 1 I’m not sure the odd european locomotive will bother anyone but the PIKO ‘G’ scale track line might seeing as how it competes for retailer dollars against the LGB track line.
Point 2 Well I guess LGBoA will either be appointed as a service centre from date X and a compromise reached on these costs OR LGBoA would have to write these costs off. I wonder if they are currently classed as an asset? Given that Nurnberg shut at the end of May 2007 it would have been pretty difficult to deliver an invoice from SD to NB after that time. So LGBoA were doing warrantee repairs for a bankrupt company that had no current way to pay for those costs at the time they were incurred? Did LGBoA put in a claim for some of these costs to the date of the liquidation? What happened after that? Is the sum of money that much of a problem? It must be if its a “major sticking point”.

My 2c

Les

#10

Les, on point #1 you are forgetting something, both Piko and Marklin also import HO to this country. The HO line by Piko is being handled by LGBoA. B I G sticking point.

#11

Ridge Road now has listed an LGB repair service – plus a 5 year warranty if purchased from Ridge Road.
Of course, and reasonably, their are specific conditions as to product useage and care to gain the warranty.
OK, what is now the role of LGB of America and its repair facility – or?

Wendell

#12

Wendell,
the Ridge Road ‘warranty’ offer has been in force around 12 months. A decade ago all LGB items in the States, sold by an authorised dealer, were offered with a five-year warranty. The packaging had an attached serialised sticker to this effect. The Ridge Road offer, carries on this fine tradition. Of course, a five-year warranty requires a spares/item replacement ‘database’. The $64,000 question is exactly who will provide the service? Bachmann has a ‘lifetime’ warranty to the original purchaser on its items. However, when the item is no longer available then the warranty is not worth the paper it is written on.

#13

Tim-
Very sharp analysis: The “repair” facet of the warranty is only as good as the spare parts.

Hmmmm. Is there a wild chance Ridge has a supply of parts for those LGB locos they are have in stock.
They are honest enough to list on their site, they say, only what they actually have in stock. Any LGB parts/trains reference as a “back-order” appears to be fantasy.

Wendell

#14

Just for information’s sake: There is a very recent report on the LGB Family Forum http://groups.yahoo.com/group/LGBFamily/message/1559 from what I can only assume is a “reliable source” (my term) that containers of LGB trains are being loaded in Europe for delivery to LGBoA in U.S. I could be wrong, but I believe that in the LGB world, “reliable source” is defined as anyone with a computer and an internet connection. The really interesting thing is that this information is posted by a forum member, rather than the forum owner, forum moderator, LGBoA spokesperson, or Marklin spokesperson. In fairness, the poster does caution that real information “. . . should always be limited to official announcements in print, not speculative forum chatter”.

There is also a lot of concern being expressed over “gray market” and “black market” or counterfeit items. Seems to be fairly evenly split between those who are buying or would buy anything with “LGB” stamped on it and those who are demanding the “genuine article(s)”. Several of the forum members appear so desperate for LGB trains that they are discussing the possibility of ordering them from dealers in Europe or S. Africa. Makes one wonder what a toy train, assembled from Chinese parts in Germany or Hungary, then shipped to S. Africa, then onward shipped to the U.S. would cost? Probably make some of Accucraft’s finest and most expensive stuff look like bargains!

Happy RRing,

Jerry Bowers

#15

Jerry,

Yeah, I believe it when the goods are on the dealer’s shelves. :confused:

But the one about the short term agreements sounds reasonably logical. My kind of thinking

HJ said:
#5 OTHER: Märklin will eventually buy out whatever assets LGBoA actually has which pertain to the LGB line.

Some of those posts must be from junkies who have very severe withdrawal symptoms. :lol: :lol: Or they just don’t know how to source materials, either way enough to give them the shakes. :wink: :slight_smile:

PS If there would be LGB items that I absolutely need to have, I would order from Europe. But so far I just call RRS and get one more “last one of those in our stock”.
That’s OK, could be the “last one” every time, as long as it isn’t “just sold the last one”. :smiley: :confused: :smiley:

#16
Jerry Bowers said:
Just for information's sake: There is a very recent report on the LGB Family Forum [url]http://groups.yahoo.com/group/LGBFamily/message/1559[/url] from what I can only assume is a "reliable source" (my term) that containers of LGB trains are being loaded in Europe for delivery to LGBoA in U.S. I could be wrong, but I believe that in the LGB world, "reliable source" is defined as anyone with a computer and an internet connection. The really interesting thing is that this information is posted by a forum member, rather than the forum owner, forum moderator, LGBoA spokesperson, or Marklin spokesperson. In fairness, the poster does caution that real information ". . . should always be limited to official announcements in print, not speculative forum chatter".

There is also a lot of concern being expressed over “gray market” and “black market” or counterfeit items. Seems to be fairly evenly split between those who are buying or would buy anything with “LGB” stamped on it and those who are demanding the “genuine article(s)”. Several of the forum members appear so desperate for LGB trains that they are discussing the possibility of ordering them from dealers in Europe or S. Africa. Makes one wonder what a toy train, assembled from Chinese parts in Germany or Hungary, then shipped to S. Africa, then onward shipped to the U.S. would cost? Probably make some of Accucraft’s finest and most expensive stuff look like bargains!

Happy RRing,

Jerry Bowers


Oh they’ve got to be %$^# kidding, South Africa???

Someone need to sit these folks down and say sloooowly and repeatedly,
“I-t-s…o-n-l-y…a…h-o-b-b-y”

I’ll beleive the container story when I see it, so far everything thats been promised by LGBoA has failed to materialize… maybe “next week” ?

#17
Victor Smith said:
Oh they've got to be %$^# kidding, South Africa???

Someone need to sit these folks down and say sloooowly and repeatedly,
“I-t-s…o-n-l-y…a…h-o-b-b-y”

I’ll beleive the container story when I see it, so far everything thats been promised by LGBoA has failed to materialize… maybe “next week” ?


Right, but how slowly can you say that? :lol: And repeating it? That will take all day and then some.

If I go on that record: I don’t believe anything until I actually see it. No credibility! But that is nothing new, has been like that since 2000/2001.

PS If PIKO starts delivering track this month, it will be interesting to watch the marketing effort by LGBoA.

#18

So Blue Moon in a Belgian Wheat Ale marketed as such but its actually brewed in New York? How does that work? What about Honey Moon Summer Ale? And WHERE can I find some Sam Adams Oktoberfest?

#19
Bart Salmons said:
So Blue Moon in a Belgian Wheat Ale marketed as such but its actually brewed in New York? How does that work? What about Honey Moon Summer Ale? And WHERE can I find some Sam Adams Oktoberfest?
Bart,

Hmmmmmmm … let’s see, the creative people import some Belgian soil - 45 gallon drum will do - sprinkle it under the brewing machinery and voilà you have beer that’s brewed on Belgian soil. Easy, eh??

#20

From the “latest” news…

Let’s grant LGB of America is going to receive a shipment of LGB products from LGB of Germany. Say David Buffington’s quote – per above note from Jerry Bowers - is absolutely reliable. IF accurate, I will assert that Marklin DOES perceive they own LGB of America and is letting them exist. Second assertion is the “sale” of LGB of America to G45 is either currently being contested, is threatened to be contested, or has been dropped mutally by both parties – if LGB of America needs money they would surely need it to contest ownership. Marklin MAY be very shrewed in allowing the remaining products to be distributed (read sold) by a company very desperate to garner funds. LGB of America may be that company. There was NO statement as to what the financials were in this to be affirmed deal between LGB of America and the home factory (LGB of Germany? Marklin?)

Gee, whiz, maybe LGB of America “owns” remaining pallets of LGB stuff that didn’t get shipped to San Diego those days prior to the financial collapse.

Best guess…
Marklin makes more large scale products under the LGB/Marklin name and either distributes on their own, gradually shutting down LGB of America as a distribution source, or incorporates them into the distribution fold with Markin as the tacitly understood non-contested owners of LGB of America. Marklin sends the goods, LGB of America distributes them.

Wait, hold on, an earlier report extolled that Marklin is shipping large scale products to the U.S.A. - is that via LGB of America? Through their own distribution system?

Is this the same report with a different source?

“Adventure land” continues. Still good stuff!

Selah,
Wendell