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Interview with Malibu's CEO


wakebrdr94

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Well, the one thing that I did notice, was that Malibu took one heck of a price hike this year. (At least on the 23 LSV, which was the only one I priced last year and this year) Might just be from the model redesign..... However, a 16K increase on identical specs, is pretty big.

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Well, the one thing that I did notice, was that Malibu took one heck of a price hike this year. (At least on the 23 LSV, which was the only one I priced last year and this year) Might just be from the model redesign..... However, a 16K increase on identical specs, is pretty big.

Then vote with your credit card . . . don't buy the +$16K boat.

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Why do share prices often drop below the offering price after a financing is announced?

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Because there are more sellers than buyers! :)

I'm not sure I see how a niche boat manufacturer is a good long term investment especially when the market is at a historical peak. Not sure I see the growth to keep things interesting.

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This whole corporate governance debate is off topic. I was simply commenting that Malibu is the only in-board tow boat that has gone public (to my knowledge). This has allowed them to erase their debt and raise a butt load of money for factory expansion and R&D that doesn't negatively impact their balance sheet. I'm just curious how this skews the marketplace for their competitors that don't have this level of access to capital, without financing costs. Will this allow Malibu to price undercut their competitors and take even more market share?

I realize that going public will have all sorts of other issues that their private competitors wont have to deal with, but perhaps in Malibu's scenario, where their factory was running at max capacity and they are poised to steal more market share, going public at this moment may have been the right decision for both the VC's and the company. I too fear that they will start cutting corners for profit too.

Again, keep in mind the IPO did not leave them with extra cash given they had to pay off the debt incurred when they paid the dividend to their shareholders. Any major projects now will need to be financed with additional debt or cash flow as it is generated. I think a business like this is best served staying private and not being subject to he quarter to quarter pressure of meeting public expectations, however, the private equity owner must have deemed this the best way to exit.

I suspect there will be more shares offered by Malibu but given the private equity overhang, I think they will likely to be secondary shares and not primary shares offered by the Company - that is, existing shareholders will continue to look to sell down their prositions by offering shares to the public but the Company will not receive any proceeds itself. Just a guess.

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