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LASAR - Paul and Shery Loewen


Bob_Belville

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16 minutes ago, Marauder said:

Unfortunately, letting go of a business can be an emotional restriction on the process. I don't know much about Lasar and their business, but it could be Paul has a lot of inventory and values it. He also sees value in the STCs they hold and the value to the Mooney community.

A serious buyer would be looking at the books to determine the annual revenue, net operating profit and inventory carrying costs to determine value and a reasonable offer. If Lasar is doing $5M in revenue and nets $200k in operating profit, who would pay $5M for it? Or even $1M?

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One way to measure the economy is the times earnings companies sell for. 4+ years is considered a  strong, optimistic economy. We've seen 1.5 at times. Not sure what typical is right now but probably 3ish times earnings I'd guess. That's if you're looking at it as an annuity business. If you just want to gut the business you look at asset value.

 

-Robert

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I have been in the Mooney community for only 2 years now, and live on the opposite coast and so have never been to LASAR personally.  Despite that, I have gotten invaluable assistance on the phone from them, including with parts and mods. I would have hoped a business that provides such excellent and somewhat unique service to the Mooney community would also be profitable and appealing for someone to keep going.  I am saddened to think that might not be the case.

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Been buying something from them just about every annual. It's nice to call their parts department and say "Hey you know that thingy that goes in the....." and hear back " you bet I got one and I'll get it to you overnight". I don't know their parts guy but he must know every nut and bolt that belongs in a Mooney.


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7 hours ago, M016576 said:

I think that may be the main issue: if the business is profitable- it probably wouldn't be as difficult to find a buyer- unless the terms for sale are unrealistic based on the boutique nature of the shop and the remote location.

That said, I'm interested, but I need 4 more years to complete my service / orders here... then, after that, I'd need the huge pile of cash to buy the business.  But to me, that sounds like a dream of a retirement career.

Go Job!

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1 hour ago, amillet said:

Don Maxwell Aviation Services West?

I don't think Don is any younger. I do use Don a lot for Mooney specific parts. But 99% of what we normally buy can be had from Spruce.  It really is just the Mooney specific stuff. Which reminds me I need to order a pair of those fancy new aileron linkages with the replaceable heim bearings to replace my worn pinned ones. 

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  • 3 weeks later...

ROBERT BROWN COMING BACK:  Some of you know and some don't that owner of Lake Aero Styling & Repair, Paul Loewen had Triple Heart Bypass Surgery the end of November.  Because of his paralysis and because he couldn't use his arms for 8 weeks, it has been a long recovery, and he just recently is back home.  He will not be going back to running LASAR full time.   We are very excited to announce that our former Service Manager of 15 or so years, Robert Brown (who retired and moved to Mexico), will be back to help us temporarily for up to 3 months.    We have 10 wonderful employees (see picture), none of whom are interested in taking over LASAR, so we are also hoping to find a buyer in the next few months also.  We want to keep LASAR alive and well for our Mooney friends and family!!  Please pass the word, and if you still have your Mooney, come and see us!  Shery

 PS I am sending this note, using a VERY old e-mail list from my personal e-mail!

 

Paul & Shery Loewen, owners

Lake Aero Styling & Repair "LASAR"

Lampson Field, Lakeport CA (1O2)

Celebrating our 40th anniversary 1975-2015

shop 707 263-0412   home office 707 263-0462

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  • 2 weeks later...

This is a tough one. If the employees don't want it, that says something right there. Clearly if the business is profitable, the Lowens could run the business absentee and enjoy the income in retirement. My guess is it breaks close to even and if you had to hire someone to replace Paul, it might break the bank.

I have since learned that the STC side of the business is nearly worthless. Anybody taking over control of those STCs, will have to reapply to the FAA for PMA and also the STCs themselves. The current state of the FAA discourages awarding new PMA or STCs. One might notice that our own Sabermech here seems to have hit that wall too.

That leaves the repair and parts business. The repair business as we know, is fraught with high overhead between the high cost of labor, regulatory compliance and insurance. It's tough to make a living and tough to keep good people. The business gets caught between the consumer demanding lower prices and the employees needing higher wages.

The parts side of the business might be attractive with potential. The in-depth knowledge of Dan, a storied reputation in the Mooney community, combined with a great online website with online ordering might make for a compelling business case. Here again though, there is liability in the used and refurbished parts they sell. I wonder what the insurance on just that business would be? Do you need PMA to refurbish certified parts? I don't know.

Tough nut. My guess is LASAR will dissolve at some point. Sad. 

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5 hours ago, DaV8or said:

This is a tough one. If the employees don't want it, that says something right there. Clearly if the business is profitable, the Lowens could run the business absentee and enjoy the income in retirement. My guess is it breaks close to even and if you had to hire someone to replace Paul, it might break the bank.

I have since learned that the STC side of the business is nearly worthless. Anybody taking over control of those STCs, will have to reapply to the FAA for PMA and also the STCs themselves. The current state of the FAA discourages awarding new PMA or STCs. One might notice that our own Sabermech here seems to have hit that wall too.

That leaves the repair and parts business. The repair business as we know, is fraught with high overhead between the high cost of labor, regulatory compliance and insurance. It's tough to make a living and tough to keep good people. The business gets caught between the consumer demanding lower prices and the employees needing higher wages.

The parts side of the business might be attractive with potential. The in-depth knowledge of Dan, a storied reputation in the Mooney community, combined with a great online website with online ordering might make for a compelling business case. Here again though, there is liability in the used and refurbished parts they sell. I wonder what the insurance on just that business would be? Do you need PMA to refurbish certified parts? I don't know.

Tough nut. My guess is LASAR will dissolve at some point. Sad. 

 Suspect you are not far off.  However, regarding award of STC and PMA, it is not impossible.  We have recently done both, and in fact, just got AML STC and are working on our second PMA project.  It is a lot of work, and the PMA is easily as difficult as the STC.  

The way STCs are written, they can be signed over to a new owner.  The difficulty may then be getting the PMA.  Many older STCs did not have adequate data to manufacture the kit if you were not the designer and that is what the manufacturing arm of the FAA looks for to grant PMA.  I am curious what you meant by the STC part of the business being nearly worthless.  Is it because of the requirement to reapply or was there something else related to the products?  There are some STCs that seem to have value, and if an existing PMA holder picked them up, it may not be a huge leap to keep them alive.  

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16 minutes ago, takair said:

 Suspect you are not far off.  However, regarding award of STC and PMA, it is not impossible.  We have recently done both, and in fact, just got AML STC and are working on our second PMA project.  It is a lot of work, and the PMA is easily as difficult as the STC.  

The way STCs are written, they can be signed over to a new owner.  The difficulty may then be getting the PMA.  Many older STCs did not have adequate data to manufacture the kit if you were not the designer and that is what the manufacturing arm of the FAA looks for to grant PMA.  I am curious what you meant by the STC part of the business being nearly worthless.  Is it because of the requirement to reapply or was there something else related to the products?  There are some STCs that seem to have value, and if an existing PMA holder picked them up, it may not be a huge leap to keep them alive.  

I was told by someone who has a few STCs that getting the PMA and I thought he meant the STCs too, is all but impossible right now. This was in reference to California here locally, but I know that FAA cooperation varies quite a bit around the country, so maybe it isn't so dire elsewhere, I don't know.

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The problem with getting STC's and PMA's is the turnover of experienced people in the FAA. I'm shocked at the questions I've had to answer on what should have been an easy PMA. I chose to go the DER 8110 route right now because interest is high and if it takes me another 2 years to get the STC, interest will be low. 

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23 minutes ago, Sabremech said:

The problem with getting STC's and PMA's is the turnover of experienced people in the FAA. I'm shocked at the questions I've had to answer on what should have been an easy PMA. I chose to go the DER 8110 route right now because interest is high and if it takes me another 2 years to get the STC, interest will be low. 

It's pretty screwed up, isn't it? :rolleyes:

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Surely if someone bought the business and ran the business in its current location, then that business should be allowed to maintain all of its assets including STCs?  I would think this only even be up for discussion if STCs were being sold to third parties perhaps peace meal, to be operated elsewhere.  But I am only saying that off the cuff with no legal training.

 

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12 hours ago, Sabremech said:

The problem with getting STC's and PMA's is the turnover of experienced people in the FAA. I'm shocked at the questions I've had to answer on what should have been an easy PMA. I chose to go the DER 8110 route right now because interest is high and if it takes me another 2 years to get the STC, interest will be low. 

I understand this is one of the major contributing factor in getting the Ultra certified right now.

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6 hours ago, aviatoreb said:

Surely if someone bought the business and ran the business in its current location, then that business should be allowed to maintain all of its assets including STCs?  I would think this only even be up for discussion if STCs were being sold to third parties perhaps peace meal, to be operated elsewhere.  But I am only saying that off the cuff with no legal training.

 

STC yes, the PMA is a trickier question.  If someone bought the Lowen's business and made a bunch of personnel changes in the fabrication department out of the gate, the parts may no longer meet PMA standards    

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Just now, bluehighwayflyer said:

That was a different set of circumstances than we are discussing here, though.  In this case, assuming LASAR is sold whole, the STC would not change hands.  Just the shares of the company that owns the STC would be be sold. The ownership of the STC itself would not change. 

I was thinking the same thing but if you look on the FAA website it looks like LASAR owns some and Paul owns the others.

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The downside to buying the company via a share purchase is you also buy the liability trail associated with it, the other option is an asset purchase.  But as mentioned it looks like you might lose some of the FAA holy water approval, subject to some caveats I guess.  Just a random guess on my part.

 

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The PMA is really a quality system approval.  The center of this is the quality manual, which defines all facets of manufacture and ap sale of PMA approved parts.  This could include STC parts or other parts that are intended for ones own STC or others, or duplicate parts.  If the corporation is sold intact, it is likely easily transferred, start chopping it up and all bets are off.  I suspect that the business is best left intact, but that limits potential buyers to those who wish to live in that area or can find a good remote manager.  This is a tough one, it would be my dream business, but it's in the wrong place for me and I don't have the capital anyway.  I really hope they find the right buyer, since they have had such a positive influence on most Mooney owners.

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19 minutes ago, Mark89114 said:

The downside to buying the company via a share purchase is you also buy the liability trail associated with it, the other option is an asset purchase.  But as mentioned it looks like you might lose some of the FAA holy water approval, subject to some caveats I guess.  Just a random guess on my part.

 

If you purchase the entire assets of the company you can still be liable for their debts under successor liability doctrine. 

-Robert

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"Here, successor liability is established by a statutory or regulatory scheme. There is an express or implied agreement by the purchaser to assume the seller's liabilities. The product line successor exception was created in 1977 by the California Supreme Court, in Ray v. Alad Corp. (1977) 19 Cal.3d 22.Aug 19, 2015"

https://www.law360.com/articles/690784/successor-liability-in-calif-where-to-point-the-finger

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3 hours ago, RobertGary1 said:

"Here, successor liability is established by a statutory or regulatory scheme. There is an express or implied agreement by the purchaser to assume the seller's liabilities. The product line successor exception was created in 1977 by the California Supreme Court, in Ray v. Alad Corp. (1977) 19 Cal.3d 22.Aug 19, 2015"

https://www.law360.com/articles/690784/successor-liability-in-calif-where-to-point-the-finger

I am a jailhouse lawyer.....for what that is worth.  Your example refers to known or contingent liabilities that occur at time of asset sale.  The bigger concern would be product liability.  After the asset sale has occurred, a product that LASAR manufactured, in the past, was involved in an accident and the subsequent lawsuit.  It is a lot harder to attack the new company, not impossible, just harder.  

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