Golfer's Hedge Fund Makes Bid For Nabi Maker
30 Dezembro 2015 - 9:50PM
Dow Jones News
A hedge fund founded by Greg Norman, the Australian golf great
known as "The Great White Shark," is bidding $10 million for the
bankrupt manufacturer of the Nabi children's tablet.
Great White Shark Opportunity Fund LP, a hedge fund founded by
the golfer in 2013, made an 11th-hour offer Wednesday for Fuhu
Inc., topping an initial offer from children's retail giant Mattel
Inc.
The tablet maker selected the fund, an investment arm of Mr.
Norman's sprawling Great White Shark Enterprises, lead bidder for
its business at a hearing in U.S. Bankruptcy Court in Wilmington,
Del. The fund has also agreed to finance Fuhu's bankruptcy case
with a bankruptcy financing package.
The entry of Mr. Norman's fund sets the stage for a bidding war
over Fuhu, whose lawyers spent most of Wednesday in court fighting
for the right to conduct an auction at all.
One of the tablet maker's lenders had argued that the company
would bring in more money to lenders if it was sold off in pieces
rather than put on the auction block as a going concern.
Peace broke out, however, when Fuhu, its lenders and Mattel
agreed to name Mr. Norman's hedge fund as stalking horse, or lead,
bidder.
As part of its offer, the Great White fund agreed to allow Fuhu
to spend $700,000 in cash it has on hand to pay down lenders,
satisfying that group's objections. The Great White offer also
doesn't include a breakup fee and assumes customer warranties on
Fuhu's Nabi tablets designed to usher children safely into the
online world.
The 60-year-old Mr. Norman, who won two majors in his career
with aggressive play that resulted in his nickname, now lends his
name to golf courses, clothing, wine varietals, eyeglasses, a
restaurant and a line of Wagyu steaks, all part of his Great White
Shark Enterprises. He began the Great White fund in 2013 with $75
million.
Great While's offer will be tested during a Jan. 20 auction. The
rules governing the auction and the bankruptcy-financing package
still require court approval. Bankruptcy Judge Christopher Sontchi
set a Tuesday hearing for the issues.
Fuhu entered chapter 11 earlier this month, battered by a
dispute with its supplier and running out of money. As previously
reported, Fuhu blames the world's largest contract manufacturer,
Foxconn Technology Group, formally called Hon Hai Precision
Industry Co., for late delivery of its tablets that damaged its
2014 holiday sales. Foxconn had declined to comment, citing "a
strict company policy of not commenting on any matters related to
current or potential customers, or any of their products."
Earlier this year, Foxconn, which is also an investor in Fuhu,
shut off the supply of Nabi-branded tablets, leaving Fuhu
struggling to fill the orders that came in this year from big-box
retailers, court papers say.
Fuhu's tumble into bankruptcy marked a dramatic reversal for the
company, whose children's technology business brought in revenue of
more than $195 million in 2013. The startup topped Inc. Magazine's
fastest-growing private company in America list two years running,
in 2013 and 2014. Forbes magazine named Fuhu the most promising
company in America in 2014.
Write to Stephanie Gleason at stephanie.gleason@wsj.com
(END) Dow Jones Newswires
December 30, 2015 18:35 ET (23:35 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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