Brunswick Reaches Agreements With Boat Builders.
LAKE FOREST, Ill., Dec. 22 /PRNewswire/ -- Brunswick Corporation (NYSE NYSE
See: New York Stock Exchange : BC) announced today that it had reached agreements with two groups of boat builders who have asserted antitrust claims against the company related to the sale of sterndrive The sterndrive, or stern drive, is also called inboard/outboard (I/O), and is a form of marine propulsion. The engine is located inboard just forward of the transom (stern) and delivers power via a shaft that goes through the transom to the drive unit (often referred to as the and inboard engines; these groups purchased 80 percent of the relevant engines in the outstanding litigation. As a result, the company said it would record an after-tax charge to operating earnings of approximately $40 million in the fourth quarter of 1999.
Under the terms of the first agreement, the company will pay $30 million to members of the class action suit filed on behalf of certain boat builders. Settlement of this case is subject to approval by the court. Under the terms of the second agreement, the company will pay the members of the American Boatbuilders Association (ABA) $35 million.
As previously reported, Brunswick is appealing the award by a Little Rock jury of trebled damages under the antitrust laws of $133 million to a further group of boat builders, Independent Boat Builders, Inc. (IBBI). Should the verdict be reversed by the appellate court, the company would not have any liability to IBBI, nor would it make any additional payments to the ABA.
If the company ultimately makes a payment to IBBI in excess of $35 million as a result of a final judgment or settlement, the company will make an equal payment to the ABA, less the $35 million already paid to the ABA. If the company makes a payment to IBBI in an amount less than $35 million, the company will not be required to make any additional payment to the ABA.
"We are pleased that these agreements achieve two major objectives. First, these boat builders are very important customers of ours, and the agreements resolve all outstanding issues and allow us to focus on meeting their future needs. Second, the agreements reduce substantially the potential liability associated with this series of lawsuits, thereby reducing the potential financial impact on the company," said Brunswick Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Peter N. Larson.
Headquartered in Lake Forest, Illinois Lake Forest is a city in Lake County, Illinois, United States. The population was 20,059 at the 2000 census. The city is south of Waukegan, Illinois, on the shore of Lake Michigan, and is a part of the Chicago metropolitan area and the North Shore. , Brunswick is a multinational company serving outdoor and indoor active recreation markets with leading branded consumer products that include Zebco and Quantum fishing equipment; Igloo, American Camper and Remington camping gear; Igloo coolers and ice chests; Mongoose mongoose, name for a large number of small, carnivorous, terrestrial Old World mammals of the civet family. They are found in S Asia and in Africa, with one species extending into S Spain. and Roadmaster bicycles; Brunswick bowling centers, equipment and consumer products; Brunswick billiards tables; Life Fitness, Hammer Strength and ParaBody fitness equipment; Sea Ray, Bayliner and Maxum pleasure boats; Baja high-performance boats; Boston Whaler and Trophy offshore fishing boats; Mercury and Mariner outboard engines; and Mercury MerCruiser sterndrives and inboard engines.