MSD Ignition on the ropes

[WildBillyT]

They filed for chapter 11 bankruptcy today according to dow jones.

[BonzoHansen]

huh. been trying to sell themselves for a year


MSD Performance Files for Chapter 11 to Find a Buyer
Jacqueline Palank
September 06, 2013
(c) 2013 Dow Jones & Company, Inc.






MSD Performance Inc ., which makes performance auto products for street and racing use, on Thursday filed for Chapter 11 protection.

After failing to find a buyer to please its lenders last year, and with a forbearance period running out Friday, MSD Performance said it would use the breathing room offered in Chapter 11 to find a buyer.

"Running a marketing process under court supervision will enable the debtors to maintain their ongoing businesses and preserve the jobs of their approximately 450 employees," MSD Performance Chief Executive Ron Turcotte said in court papers filed Friday.

To ensure MSD Performance can afford the costs of a Chapter 11 sale process, lenders have agreed to let the company use the cash securing their claims, subject to court approval.

Based in El Paso, Texas, MSD Performance was founded in 1970 as a research and development company by two engineers who were working on a U.S. military missile range. It has since shifted gears, now making ignition performance products like performance coils, spark-plug wires and fuel-injection systems.

MSD Performance sought to accelerate its growth in 2005 and 2006, snapping up several companies---Superchips, Racepak and Edge Products---during the height of the mergers and acquisitions boom. Superchips' products, for instance, let users increase the horsepower, torque and fuel efficiency of their vehicles.

While the deals allowed MSD Performance to expand its product offerings, they also required the company to take on debt to fund the purchases. In 2009, MSD Performance sought to confront its significant debt load---as well as challenges from increasing competition and the economic downturn---through an out-of-court restructuring.

Still, its liquidity remained tight, and the company struck a deal with its lenders to push out its debt maturity from March 2012 to January 2013 as long as it put itself up for sale. While several offers came in, none were high enough for the lenders, who have since entered into a series of forbearance agreements with MSD Performance that have kept the debt from coming due.

Among MSD Performance's lenders is an affiliate of private equity firm Z Capital Partners LLC , which since May has acquired a majority of the $91.9 million that's currently outstanding. Z Capital this year offered to purchase MSD Performance's assets, but the company's other lenders couldn't reach a consensus on the offer before the forbearance period expired.

"The debtors remain hopeful, however, that negotiations with Z Capital or any other interested bidder will continue in connection with a court-supervised sale process," Mr. Turcotte said in court papers.

Any sale plans would be subject to the approval of the U.S. Bankruptcy Court in Wilmington, Del., where MSD Performance sought protection.

MSD Performance reported assets of $50 million to $100 million and debts of $100 million to $500 million in its bankruptcy petition.

Lawyers from Jones Day and Richards, Layton & Finger are representing MSD Performance in its bankruptcy case, which has been assigned to Judge Peter J. Walsh.

Write to Jacqueline Palank at jacqueline.palank@wsj.com.

[sweetbmxrider]

The msd optis have been coming up bad lately.....how can I acquire $500 million in debt legally? And wipe my hands clean of it?

[Dudbird113]

Both my optis which is both the spline and cam pin work fine

[LTb1ow]

The msd optis have been coming up bad lately.....how can I acquire $500 million in debt legally? And wipe my hands clean of it?

Buy a house, and get like 10 credit cards... then, max them all out, and bail.

[NHRABill]

I was reading article in new Hot Rod Mag today showing how to spot MSD knockoffs. Didn't realize that they have been getting ripped off for so long. Sucks to see them struggle.

[jam01]

I was reading article in new Hot Rod Mag today showing how to spot MSD knockoffs. Didn't realize that they have been getting ripped off for so long. Sucks to see them struggle.

this has been going on a long time, when i working gm parts we were given pamphlets on how to spot gm knockoffs.
i know other makes have been ripped off too, and performance company's.
i know some guys say that msd products suck, makes you wonder what they bought.

[edpontiac91]

The one benefit that impressed me the most, when I installed my MSD 6A and Blaster Coil, was how clean the inside of my exhaust tips stayed. I never had any trace of carbon come off when I wipe out the inside with a rag after a long run. I would say that there is a more complete burn taking place.

[WildBillyT]

this has been going on a long time, when i working gm parts we were given pamphlets on how to spot gm knockoffs.
i know other makes have been ripped off too, and performance company's.
i know some guys say that msd products suck, makes you wonder what they bought.

Probably recent MSD stuff.



They have admitted overextending themselves when they bought Superchips and other companies and started making $500 alternators. Add in the fact that going to EFI is a huge trend right now and they are in trouble. I don't know too many late model guys running MSD stuff other than plug wires and optis. Yeah there are some but nowhere near as many as carb guys running 6ALs.

I was a big MSD fan for a long time and like my current setup, but there have been quality control issues being kicked around a lot more frequently then there used to be. Almost like when Demon Carb was on the ropes.

The "fuzzy rust" on the inside of RTR distributors comes to mind. I have dodged this bullet- probably because I bought by 8360 five years ago.

[jam01]

Probably recent MSD stuff.



They have admitted overextending themselves when they bought Superchips and other companies and started making $500 alternators. Add in the fact that going to EFI is a huge trend right now and they are in trouble. I don't know too many late model guys running MSD stuff other than plug wires and optis. Yeah there are some but nowhere near as many as carb guys running 6ALs.

I was a big MSD fan for a long time and like my current setup, but there have been quality control issues being kicked around a lot more frequently then there used to be. Almost like when Demon Carb was on the ropes.

The "fuzzy rust" on the inside of RTR distributors comes to mind. I have dodged this bullet- probably because I bought by 8360 five years ago.

i just finished reading in hot rod that a lot of aftermarket company's are experiencing this problem. i have modified a few cars along with building a few engines, even though i knew of the knockoffs i never thought it affected the performance parts that bad. the oe's have it tougher with all the jobber business they deal with, some good a lot bad. and by that i mean look at say advance auto you can by cheap medium or good parts, and it all depends on what you want to spend. most of the time they dont tell you about the better quality parts they offer or if they have them.