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by Gus Breiland
Stellican (owner of Chris Craft) Buys Indian

London (July 26, 2004) — Stellican Limited, a London-based private equity firm, today announced the acquisition of the trademarks and related intellectual property of Indian; America’s oldest and most iconic motorcycle brand.

Indian Motorcycle was founded in 1901 in Springfield, Massachusetts, two years before Harley-Davidson, and was a leader in the motorcycle industry for the next 50 years with a U.S. market share approaching 50%. The Indian motorcycle was the pride of the American road, enjoying an unmatched reputation for quality and innovation. In fact, motorcycle historians cite the Indian Chief as the originator of today’s cruiser class motorcycle. In 1953, the company filed for bankruptcy and, for the ensuing 45 years, the Indian brand was effectively dormant. It was not until 1998 that Indian Motorcycle was restarted by a series of investor groups. Unfortunately, however, their substantial efforts to make the company profitable ultimately failed. In September 2003, Indian Motorcycle elected to be liquidated through an Assignment for the Benefit of Creditors process managed by CMA Business Credit Services in Burbank, California.

In 2002, the United States heavyweight cruiser market (over 900cc) exceeded $4 billion with over 230,000 units sold. The market recently has experienced double-digit growth rates with continued strong growth projected. The premium (+$12,000/unit) heavyweight cruiser market is considered to be the most profitable segment. This is where Indian Motorcycle competed by providing the only credible alternative to Harley-Davidson in terms of brand, heritage, style and American quality. Today, Indian has an extraordinary 94% aided brand awareness in the USA and enjoys a cult-like following among motorcycle enthusiasts and the population in general.

Doesn’t credible mean “in business”. Considering Indian’s credibility, I believe that Polaris might just have an upper hand in the “premium heavyweight cruiser market”.

“I believe Indian remains among the most powerful brands in the U.S. motorcycle market, and we are delighted to own such an iconic American brand,” commented Stephen Julius, an Anglo-Italian financier and founding Partner of Stellican Limited. “Our primary goal is to return Indian to its rightful position as a premium motorcycle brand, selling beautifully designed, high quality products and delivering world-class services. We will do so by carefully and thoughtfully developing the business from the ground up, guided by an overriding determination to remain true to the rich heritage of the Indian brand. We are long-term brand builders, obsessed with product design and quality. We have clearly demonstrated our ability to the world over the last three years with our re-launch of Chris-Craft boats, another business we own today and which we purchased out of the 2000 bankruptcy of Outboard Marine Corporation. We are confident we will repeat our success with Indian,” added Mr. Julius.

Stellican Limited is an unusual private equity firm in that it specializes in acquiring and reviving distressed companies, almost all with heritage brands, mainly in the recreational products area. Even more unusually, its capital is provided by its own principals who actively manage its portfolio companies directly. An enormous investment has already been made in product and engine development and Stellican is aware of the need to re-start production as soon as possible once its strategy has been clearly defined. In addition to world-class motorcycles, a key component of the future strategy will be an integrated approach to the parts, accessories and apparel business. Stellican will ensure all of Indian Motorcycle’s many constituents – suppliers, dealers, current and future customers and the motorcycle and business media – are kept informed of its plans as they develop over the coming months. Stellican will arrange one-on-one interviews with media at the appropriate juncture.

“We are excited about this challenge and are confident Indian will live up to its great potential under our ownership. This is a tremendous opportunity to revive a great American brand and we intend to do exactly that,” added David Wright, a Partner at Stellican.

Thus far, the company has provided few specific details about its plans for the future of Indian motorcycles, though it seems unlikely that existing Indian motorcycle owners with warranty problems will find any help from the new owner of the brand. We speculate that its initial models will closely follow the models that the previous Indian entity produced when it closed its doors in September 2003, which would at least provide some help with parts.

From the looks of Stellican’s portfolio, they acquire defunct businesses to create a fairly diverse business conglomerate. Hopefully, they make a go of Indian and bring it back to life. Competition is a good thing and Harley Davidson needs to be pushed in ways that make them more technologically advanced and mechanically sound. What is left is the question, will this be another Indian revival or Excelsior-Henderson face plant. Stay tuned.

Victory and S&S

MEDINA, MN (Aug. 5, 2004); To satisfy the power and performance desires of its customers, Victory Motorcycles has teamed up with the leading aftermarket source for American V-twin performance equipment, S&S Cycle, Inc. in an alliance that will result in development of high-performance engine components for Victory motorcycles.

Victory, the motorcycle division of Polaris Industries Inc., will provide the S&S Cycle product development team with technical information about Victory Freedom™ V-Twin engines as well as advanced information about new Victory products. This will allow them to design, test and produce performance equipment for Victory motorcycles in the most timely fashion.

The alliance was announced during the Polaris 50th anniversary celebration held at the Minnesota State fairgrounds this past July and will be formally unveiled to motorcycle enthusiast this August during the Sturgis motorcycle rally. The alliance represents an ongoing commitment by Victory to only partner with the best in the industry and will allow Victory owners to outfit their motorcycles with the most coveted performance products in the business.

“We responded to our customers’ and dealers’ requests for more performance equipment by working with the best aftermarket performance company in the business, S&S Cycle,” said Victory General Manager Mark Blackwell. “Our customers will have access to outstanding performance products from the true industry leader. This is in keeping with the Victory approach of partnering only with the best in the business.”

S&S Cycle is a family owned and operated aftermarket company that has produced V-twin performance equipment for 46 years. The company is based in Viola, Wisconsin, and distributes its products through a worldwide network of S&S dealers. Smith said the first S&S Cycle products for Victory motorcycles will be performance kits that convert Victory’s Freedom™ 100/6 and 92/5 V-twin engines into high-performance 106-cubic-inch (ci) engines. These kits are scheduled to be available in the spring of 2005.

S&S Cycle will sell its Victory-related performance equipment directly to authorized Victory dealers and will not sell the products directly to consumers.

“Not only does this relationship support the Victory customer base, it also supports the dealer network and its critical involvement in projects like this,” Smith said.

5th Annual Scooter Du

The annual Scooter Du has passed and with it, a beautiful weekend of riding scooters and meeting new friends. “A New Day Rising” was this years motto and by the look’s of it, the scooter is taking over the world starting in Minneapolis. Scooter Du was 2 days of Scoot love involving 164 registered participants and a group ride on Saturday with around 125 scooters taking over the streets of Minneapolis if only for a short time.

Stella and I roamed city scape of Minneapolis with “the Regulars” (hosts of the 5th annual Scooter Du) and participants taking in such attractions as Elsies Restaurant, Bar and Bowling Center (729 Marshall Street NE, MPLS), Square Peg Diner (2021 East Hennepin Ave, MPLS), Betty’s Bikes and Buns (600 E. Hennepin Ave, MPLS), Scooterville (650 25th Ave SE, MPLS), Triple Rock Social Club (629 Cedar Ave. S, MPLS) and Yarusso Brothers (635 Payne Ave, Saint Paul).

There were tales to be told, both tall and short. The Friday night midnight ride caused quite a few folks to be Minnesota nice to a gentleman from Colorado the next morning. The Saturday scooter ride had us traveling around the city: east, west, north but not too much south with food, gymkhana and slow ride games at Scooterville.Your assignment, buy a scooter and join “the Regulars” next year for a weekend of fun and frivolity. Look for links to photos and more at www.minnescoota.com.

Roy’s Repair–Motorcycle Basics for Women

Roy’s Repair of Minneapolis will be holding a class designed to familiarize new and beginning female riders with their cycles. It includes basic maintenance, trouble shooting and minor repairs. The course also covers: Winter Storage and Spring Prep, A discussion of Parts & Accessories and Tips on “How to be a Knowledgeable Motorcycle Owner,” and more. Bike buying made easy. The course consists of four 2 hour sessions over a four-week period. Classes are from 6:30 to 9:00 PM and will be held at Roy’s Repair. Your instructor will be Lewis Lakey.

The cost will be $199 and classes will be running in the fall from the week of October 13th through the week of November 3rd or the spring class will be running the week of March 15th through the week of April 15th. Use this article to sign up and circle the evening you prefer (Wednesday or Thursday). If you have any suggested topics, include them with your registration. If you would like to register a group and tailor the class to certain topics and needs, please inquire at the contact information below.

To register, ask questions or for further details give Barb Lakey a call at 612.721.8868 or email her at barb@roysrepair.comClasses will be held at Roy’s Repair located at 3232 Snelling Ave S. in Minneapolis Minnesota, 55406.

M.M.M.

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