Through eight separate filings Nov. 18 and 19 the current Beaudry companies filed for Chapter 11 protection and reorganization. The companies include Beaudry RV in Tucson and Chandler, Beaudry RV Resort, Berry Good Cars used cars and Beaudry Chevrolet Chrysler Jeep & Dodge in Benson. Four real estate holding companies were included in the filings.
Chief Executive Thomas P. Sylvester said the bankruptcy filings were made to primarily to restructure financing related to real estate debt. While the downturn in sales was a factor, the company was most interested in protecting assets from the demands of lenders holding secured debt on the buildings and real estate.
 Joe Pangburn photo |
In a statement, the company said it has reduced its debt to $13.3 million from $42 million in 2006.
“We’ve paid them down — just in the last four or five months — $26 million,” Sylvester said. “That’s a lot of money in anybody’s world. But they want it paid off. I guess they didn’t get any of the bailout money.”
Despite the company’s efforts over several months, Sylvester said Beaudry has been unable to work out repayment agreements with its lenders.
The level of antagonism between Beaudry and its lenders surfaced Nov. 19, the day after most of the bankruptcy filings, when Bank of America, Wells Fargo and Comerica Bank filed an unsuccessful request for a motion to block Beaudry from paying wages to its employees while in bankruptcy.
The banks said they were owed more than $14 million and were not given any prior notice - or even intent - by Beaudry to file for bankrupcty protection.
Bankruptcy Judge James Marlar ruled in favor of Beaudry’s request to pay the employees.
In its quest to pay down its debt, Beaudry raised more than $36.8 million over the past 14 months selling off assets to Chapman Automotive, which in 2004 had acquired the franchises for six former Beaudry auto dealerships.
According to Pima County public records, those transactions were:
• $3.8 million in September 2007 for the real estate and buildings of Mercedes-Benz of Tucson, 6001 E. Speedway.
• $15.5 million in July for the real estate and buildings of what is now Chapman Honda, 4646 E. 22nd St.; Chapman Acura, 4600 E. 22nd St.; Audi of Tucson, 4690 E. 22nd St.; Porsche of Tucson, 4690 E. 22nd St.; and Chapman Volkswagen of Tucson 4500 E. 22nd St.
• $3.8 million in July for the real estate and buildings of Berry Good Cars, 5300 S. Palo Verde Road. (The used car dealership is still being operated by Beaudry and was among the companies put under Chapter 11 reorganization.)
• $6.6 million in July for the real estate and buildings of Beaudry Chevrolet Chrysler Jeep & Dodge in Benson. (This dealership is also still being operated by Beaudry and was put into Chapter 11).
• $5.5 million in September for the franchise, real estate and buildings of Saturn of Tucson, 6350 E. Grant Road. (The Saturn franchise was not among the original dealerships Chapman had acquired in 2004.)
While the recreational vehicle industry has been hit hard by the economic downturn, Sylvester said “our ownership and management feel very optimistic about the recovery of the industry.”
The largest proportion of RV buyers are often over age 55, and the aging of the baby boom points to ever greater potential growth over the next decade.
“The RV lifestyle isn’t going away,” Sylvester said. “When economic conditions change again, the industry will recover. And we want to be there to continue to provide exceptional value and top-notch service.”
Sylvester stressed that daily operations at the dealerships will continue.
“We fully expect the high quality of sales, service and hospitality to be the same next week as it was this week,” Sylvester said. “We have a terrific staff, a dedicated management team and committed owner.”
As for the automobile dealerships, Sylvester offered no specifics but said “It has been our plan for some time to phase out of the auto dealerships.”
Contact Joe Pangburn at jpangburn@azbiz.com or at (520) 295-4259.
Beaudry
Beaudry Motor Company was founded in 1940 by S.M. Beaudry as a Chrysler and Plymouth dealership. Beaudry RV was established in 1972.
Beaudry’s grandson, Bob Beaudry, was elected chairman of the dealerships in 1986. Beyond being known for his dealerships, Bob Beaudry was a leader in a successful election campaign in the 1990s to stop the City of Tucson from directly delivering water from Central Arizona Project to customers.
He was unsuccessful in a subsequent election when the city offered a plan that would combine direct-delivery with recharged CAP and well water.
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