Hobbico files for Chapter 11 Bankruptcy

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WoodiE

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Well this sucks and is certainly something you don't like hearing - Hobbico is filing for Chapter 11 Bankruptcy.

Hobbico distributes over 150 brands and 30 proprietary brands that include Arrma, Axial, Flyzon, Futaba, Great Planes, Dynamite, and many more.

Hobbico announced today that we are filing for restructuring under Chapter 11 of the Bankruptcy Code and that we are pursuing a process to sell or restructure the company. It’s important to know Hobbico will continue to operate the business throughout the bankruptcy process. Numerous companies across a range of industries (automotive, airlines, etc.) use this type of filing as a tool to get costs under control, create stability and build platforms for growth.

Hobbico intends to use the bankruptcy filing and a possible sale of the business to reduce our debt, restructure our liabilities, attract new investors and position the company for future growth. We carefully evaluated this vs. a number of other actions and concluded this was the best path forward.

I understand that this may be difficult news to hear. Hobbico is one of the largest U.S. distributors of radio-control and general hobby products and our business has many strengths. At the same time, Hobbico has faced and continues to face many significant challenges.
 

Northernnightmare

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So hobbico is just tower hobbies, or is it effect other online retailers directly?

I use amain mainly, but that is always strange when someone goes down wish it was traxxas instead hahaha
 

Jam Racing 1

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Yes "Hobbico" includes Tower and many other brands specific to the name Hobbico.....

But they are just filing chapter 11 which will allow them time to either drop things costing them too much money or restructure their finances to better suit their needs, I think they have been overextending and taking on several recent brands that are not turning out as they hoped....
 

Wilson

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I agree with jam, if you go on tower hobbies there are so many different brands and different hobbies to choose from. They very well could have taken on things that just didn't pan out.

Maybe they can sort the good and bad and turn it around. I sure hope so.
 
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All we can do and what I’ve done for the past 20 years or so is go out and play with my stuff and get other people into the hobby! I’m a nitro guy and nitro draws crowds. I’ve gotten countless people into our hobby just by doing that
 

rcaircraftnut

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My main interest for the last 30 yrs has been rc airplanes. I have messed with cars off and on throughout that time. Manufacturers come and go. Just look at how many defunkt kits there are for rc planes. I personally have 6 kits that are out of production. As well as at least 8 built and flying that are oop. Point is as long as there is a demand there will always be another manufacturer willing to step up and fill it. It could be worse. I have another hobby. It is currently my main interest. Rc combat warships. There is only two current kit pruducers for the ships and one is currently selling off and closing up. There has always been extremely limited ready to use components. We make our own gun systems, build the ships from scratch, and do a lot of repurposing of non hobby items to build these combat ships. It takes more than being able to insert tab a into slot b to be a modeler. Remember that.
 

JVT73

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I noticed a month or so ago that Tower is/was dropping the MIP drivers! Of all the thing to get rid of and they stop stocking the best drivers in the business(in my opinion). I love my hex drivers!
 

JVT73

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I noticed a month or so ago that Tower is/was dropping the MIP drivers! Of all the thing to get rid of and they stop stocking the best drivers in the business(in my opinion). I love my hex drivers!
My hex drivers...are like...hex drivers to me! This is my hex driver, there are many like it but, this one is mine!
 
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WoodiE

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A Judge has OK'ed the purchase of Hobbico by Horizon!

CHAMPAIGN — A bankruptcy court judge approved Horizon Hobby's $18.8 million purchase of Hobbico's remote-control business Monday, which means Hobbico employees must reapply for their jobs at Horizon before the purchase is completed Friday.

Hobbico's more than 300 employees were made aware of this possibility last week, after Horizon was the lone bidder in a bankruptcy auction for Hobbico, which filed for Chapter 11 protection in January with the goal of finding a new buyer.

"As mentioned in yesterday's Town Hall Meetings, Hobbico employees who are interested in being considered to work at Horizon Hobby are required to apply online," Hobbico human resources manager Megan Huppert wrote Friday in an email obtained by The News-Gazette.

It's not clear how many of the employees will be hired at Horizon, especially since the two Champaign-based hobby-product distributors perform similar tasks.

"Horizon and Hobbico have served many of the same retailers and customers for years," Horizon CEO Joe Ambrose said when his company announced it would try to buy Hobbico's RC units.

Horizon is buying Hobbico's Great Planes and Tower Hobbies divisions, along with its Axial and Arrma brands.

Also on Monday, a bankruptcy judge approved a separate $7 million sale of Hobbico's Colorado-based model-rocket subsidiary, Estes, to an organization called The Langford Group.

An auction for Hobbico's remaining assets — including United Model, Revell US and Revell Germany — was temporarily suspended last week.

Hobbico employees will be applying for jobs in departments at Horizon rather than specific positions, and a temp agency is helping Horizon process the applications.

"Due to time constraints with hiring/reviewing/interviewing 300+ employees, Express Employment is assisting Horizon with the recruitment process," Huppert wrote. "Employees who are selected to work in the Distribution Center could start on Saturday, April 7th through Express Employment."

If employees apply by Friday, their seniority with Hobbico will be used to determine when they're eligible for benefits.

However, "If you apply after the close of the transaction (April 6th), you would be considered a new applicant and treated like any other external candidate," according to a document attached to Huppert's email.


"We will review the applications and get in touch with candidates with whom we are interested in moving forward," the document said, later saying: "We plan to interview as many people as we can, but given the short time frame prior to closing, we will not likely be able to interview everyone."

A representative for Hobbico could not be reached for comment Monday, and a representative for Horizon said the company would issue a statement after the sale closes.

The two companies were both formed in 1985 and are among the top 25 employers in the county, according to the Champaign County Economic Development Corp.

Last year, Hobbico said it employs 415 people in the county, and Horizon Hobby reported 341 employees.

source: http://www.news-gazette.com/news/lo...s-horizons-purchase-hobbicos-rc-business.html
 

X

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Not sure how I feel about this. It is especially rough for Hobbico's employees. The way this reads, most of the employees should just assume they are out of a job. Seems like Horizon is stringing them on a little.
 

Jam Racing 1

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OUCH that has to hurt alot of folks, I guess we have to hold hope most people get some form of employment.....
 

olds97_lss

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It stinks for the employees, but it's good to see axial and arrma will hopefully be around for a while. Sadly, I haven't shopped from tower or horizon in a long time. Got tired of paying higher shipping fees than ebay offers. I have bought from horizon on ebay quite a few times though.
 

NightFlier X4.6

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Glad I'm not the only one that felt Horizon pretty much in a round about way told hobbico`s employees they don't have a chance at getting there job back. What a freaking shame I feel so bad for them and their families.
 
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