Bankruptcy, the sequel

Posted by Iannucci | 3/07/2008 | 4 comments »
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By now you’ve probably already read the news that Champ CART has declared bankruptcy. Again. Technically, Robin broke this story three weeks ago, so he only missed the mark on this story by about 500 hours. With a bit more accuracy we have to point towards Oreo and Will at Is It May Yet? for both finding the interesting points in the legalese that I have neither the time nor the inclination to try to dissect.

16. After four seasons of owning and staging the open wheel racing series known as the “Champ Car World Series,” the Owners and the Debtor determined that it is no longer economically feasible to sustain an open wheel racing series and that the Debtor did not have the funds to operate the series in 2008.

Well, duh! The previous series ownership could have told you THAT.

Anyhow, even though the bankruptcy filing was filed in the same court as it was four years ago (the “Irony” switch is set to “ON”), it should be noted this time Mr George has taken the preemptive step of buying the series assets he desires before the filing. And even more ironic is that while he appears to have paid less than thirteen million bucks he was offering for the series back in 2004, the cost will be significantly more given the offer of this basket of freebies for CCWS refugees.

Given the massive out-of-pocket expense one might say this was all a REALLY expensive impulse buy by Mr George, but something everyone seems to forget is that back in November it was announced that IMS had sold their stake in a fun little speedway near Chicago. At the time the speculation was that the $69 MEEEEEELLION payment would be used for upgrading facilities at the The Brickyard, but looking back now it certainly appears Mr George had already been whistling past the motorsports store and eyeing that Champ Car World Series in the window.

Various Champ Car assets: $6 million

Consulting fees to old rivals: $4 million

Two free cars and free engines for a dozen refugee teams: $21 million

Winning the open-wheel war: priceless

4 comments

  1. bbovenguy // March 07, 2008 11:08 AM  

    And if you wanted to turn the irony up yet another notch, you could point out that TG will get a big chunk of that money back from the profits he makes at this year's NASCAR race at the Speedway...

  2. Tabernerus // March 07, 2008 12:19 PM  

    The part I found interesting is that in addition to signing a non-compete agreement of some kind, Forsythe and Kalkhoven will only get their $2 million if they show commitment and support of the IRL. That's Oreo's wording, and I don't know how direct a quote it is from the actual paperwork. But if it's even close to accurate, I'd say that Kalkhoven is at least outwardly doing his part. His team will race in the series, and he's saying the right things. Forsythe, though? What's the deal there? Is he walking away from $2 million? Or did TG agree that for the sake of peace and harmony, he'd view quiety leaving without making any grand statements of a negative nature as "commitment and support?" Personally, I think it might be a good trade. :-)

  3. Zappatista // March 07, 2008 2:06 PM  

    The most glaring comment in the fold is

    "The memorandum includes a non-compete covenant for Forsythe and Kalkhoven, who are each slated to receive an additional $2 million, provided they pay certain expenses associated with the promotion and operation of this year's Long Beach race; and show commitment and support of the IRL."

    Reeeeaaaaalllly.....show commitment and support, huh? So is disbanding your race operations really showing the form of commitment and support that the IRL was looking for Mr. Forsythe? What a jackass...

  4. Jennifer of Dog.Yarn.Knit. // March 07, 2008 4:11 PM  

    Bottom-line, we all need to go out and buy some Clabber Girl straight away to make sure the Hullman-George family doesn't go hungry.