April 23, 2007 – Hot News
April 23, 2007
Filed under News
DENVER — The RPM Group, the industry’s largest 20 club provider, was set to be acquired by Assurant Solutions in a deal that will provide greater brand recognition for the F&I provider and more resources to the company that was previously majority owned by Mark Tkach and Bill Coulter, the co-owners of RideNow Powersports ?Management Group.
Tkach, Coulter and current President Sam Dantzler purchased the RPM Group, then named the Lemco Management Group, two years ago.
The trio were not shopping the 20 club and training provider when Dantzler approached Tkach and Coulter last year about partnering with Assurant Solutions, a division of Assurant Inc., a public company with assets of more than $25 billion. The discussion later turned from creating a partnership to Assurant purchasing the company.
“Mark (Tkach) has made the comment several times that he wants to do what’s best for this company — to grow it as fast as it can grow and in the best interests of our clients,” Dantzler said, noting the added resources Assurant has will help propel the company’s growth.
Dantzler will continue to be president of the RPM Group, which will remain an independent company under Assurant Solutions, said Jimmy Atkinson, vice president of the company’s Auto & Recreational Services division.
“We see (the acquisition) as a fit for us because it dramatically impacts our name recognition in the powersports market,” Atkinson said, also noting both RPM and Assurant do quite a bit of dealership training so there’s “a natural synergy between the two companies.”
Atkinson did not expect any changes in RPM’s location — it’s headquartered in Denver — or personnel to coincide with the purchase, which was scheduled to close on the week of April 16. Terms of the sale were not released.
Atkinson does believe an increase in the RPM Group’s staff size is a possibility.
“We see a lot of headroom and upside potential down the road to grow what RPM is doing,” he said.
The acquisition marks a different type of investment for Assurant Solutions, which, in its three years of providing F&I services to powersports dealers, has relied primarily on organic growth.
Assurant Solutions has provided F&I services in the automotive market for more than 30 years and provides those same services for the RV and marine markets. Publicly sold on the New York Stock Exchange as AIZ, the company has not purchased a training or 20 club provider in either the auto or RV markets.
Assurant Solutions currently services about 100 powersports dealers. Its net operating income of $158.4 million increased nearly 19 percent in 2006 compared to the previous year, according to Assurant’s year-end financial report.
Assurant Solutions’ Auto & Recreational Services division has about 60 outside sales reps who serve the company’s auto, RV and powersports markets. Some of those sales and training reps could cross-train so they’re providing both Assurant Solutions and RPM Group training to powersports dealers.
“Their availability to get into dealerships for training and support on a regular basis is key for the RPM Group,” Dantzler said of Assurant Solutions’ staff.
The acquisition won’t mean RPM Group or Assurant Solutions’ customers will have to sign up to be part of both companies in order to receive the services of one of the companies.
“We hope (RPM Group dealers) will choose us to be their provider for F&I products,” Atkinson said, “but RPM is going to operate separately.”
“The intent,” Dantzler said of the acquisition, “is to grow this thing and offer as many value-added pieces to the clients as we can to create a turn-key system.”
One of those pieces will be additional training DVDs, which RPM Group debuted last year. With the acquisition, Dantzler expects to use an Assurant production center in Florida that will reduce the time it takes to produce a new training DVD to about a month, a significant decrease from the 13 months it took RPM to produce the original DVD.
“Becoming a true training entity requires some resources that aren’t available to us right now,” Dantzler said.
The change in majority ownership from Tkach and Coulter, owners of the largest powersports dealership group in the United States, to Assurant also could boost the number of dealers that sign up for 20 clubs, Dantzler said, noting that “some dealers choose not to participate” because of the perception that RPM Group data was being shared with RideNow.
Tkach’s “whole point to being involved in the RPM Group was to make sure that Dealer Candidate School training continued for the general managers so that he could continue to open stores,” Dantzler said. “That part will never go away and that piece will continue so there’s not a risk of losing that component.”
In fact, Tkach, who could not be reached at press time, will continue to be a RPM Group client and continue to use the company’s management development programs, Dantzler said.
GE Money, Arctic Cat Extend Relationship
GE Money’s Sales Finance unit and Arctic Cat have extended their working relationship that started with the manufacturer’s Canadian operations.
Beginning April 9, Arctic Cat will offer GE Money installment and revolving credit programs at hundreds of its U.S. dealerships. The installment loan program is called Arctic Cat Financing, while the revolving program will utilize the new Cat Card credit card.
“This is a very important new sales and marketing tool for our dealers,” said Rick Stokke, a national sales manager for Arctic Cat. “We want to empower our customers and make it easier for dealers to close more sales. We’re anticipating that a lot of sales energy will be created through our new financing program.”
Arctic Cat’s financing program will enable dealers to offer special financing terms, including seasonal promotions, designed to generate sales momentum. Fast credit decisions and simple paperwork will help dealers keep customers in the store, and dealers also can benefit from Internet-based financing management tools.
“We’re providing Arctic Cat with a flexible program that will help generate more sales of units and accessories,” said Gregory Pierce, vice president and general manager, Power Products, for GE Money Sales Finance.
GE?Money also announced that it has signed another of its OEM partners, Honda, to a multi-year extension.
PSB increases Its Editorial Staff
Powersports Business has added yet another veteran newspaper journalist to its editorial team.
Teri Kelsh joins the magazine, which will celebrate its 10th anniversary in January, in the new position of associate editor.
“We’re thrilled to have Teri join our group,” said PSB Editor Neil Pascale. “She has extensive news and business reporting experience that will be instrumental to our continued growth, both in print and online.”
Along with a host of Powersports Business assignments, Kelsh will be managing the content for PSB’s twice weekly E-newsletter as well as its annual Market Data Book, which will be published in August. She can be reached at firstname.lastname@example.org or 763/383-4413.
American Motorcylist Association Names New CEO
The American Motorcyclist Association has named its president, Rob Dingman, chief executive officer, replacing Patti DiPietro, who has served as CEO since January 2006.
“This appointment completes the transition in AMA leadership that was begun a year ago,” said Dal Smilie, AMA board chairman. “That process included a lengthy search period, resulting in the hiring of Dingman as president last December.”
DiPietro began her career in the AMA mailroom in 1976, and progressed steadily while continuing her education, becoming an accounting clerk, vice president of finance and operations, and chief financial officer of the association before taking over as CEO last year.
Dingman served as the AMA’s Washington representative in the 1990s before returning to his native New York to serve as assistant commissioner for transportation safety in the state’s Department of Motor Vehicles.
BRP Invests in New Design Center
BRP plans to invest $12.9 million to build a state-of-the-art design and innovation center next to its head office in Valcourt, Quebec.
In 2006, BRP invested $3.1 million to expand its R&D center in Valcourt and $13.5 million in a partnership with Universite de Sherbrooke to create an advanced technologies center. This new investment will bring the Sherbrooke and Valcourt design and advanced concept teams under one roof.
The first phase of the project will begin this spring with the demolition of several buildings that are located between BRP’s head office and the Manoir Bombardier in Valcourt.
With 54,000 square feet of space, the new design and innovation center will feature several workshops and integrated demonstration rooms. PSB