Walthers purchases assets of Life-Like Products Toy and Hobby Division; Roco declares bankruptcy

[Anonymous]

Walthers is overpriced and only deals thru hobby shops. There goes trains for the kids (the future of the hobby).

[Trainnut484]

Just throwing in my [2c]. I hope this will mean Walthers upgrading to P2K and P1K standards. Also, maybe Walther's building kits, which are good in their own right, will receive a similar upgrade too.

Take care,

Russell

[orsonroy]

QUOTE: Originally posted by CNJ831

Has anybody stopped to give a thought to the basic situation that must have existed to create an atmosphere where Walthers had the potential for buying out LL? We all consider LL a major player in the hobby and its locomotives are generally held in high esteem and seem to sell well.

Now Walthers is no billion dollar company by a long shot, so LL must have been either actively looking for a buyer or at least sending out vibes to that affect through the industry. To me this says LL could either see the future in model trains tails off or they were already not profitable enough to continue.

I fully expect to see a cascade effect in the near future as the likes of IHC, Model Power, Accurail, Con-Cor, Branchline, et al. give up the ghost to Walthers. And if Walthers past company purchase record is any measure, expect to see very little of each line survive!

CNJ831

Life Like, Inc., was bought out a year ago by an investment firm. Once they took control of the company and looked at the books, they saw that the only divisions that satisfied their desire to profit from their investment was the foam divisions (the gliders are mostly foam-based). So...they went shopping for buyers. And believe it or not, Walthers is one of the biggest boys on the block. I'm assuming here that Horizon was too debt-ridden from buying Athearn and Roundhouse in the same year, and Walthers had the ca***o pony up. Nothing unusual here; these things happen all the time. Remember AMC? Well, they're still around, they just don't build Jeeps and Eagles any more.

[Anonymous]

QUOTE: Originally posted by azdub

The truth is that whether we like it or not, the model RRing hobby is slowly shrinking, which is why you are seeing consolidation in the industry.

One reason LifeLike probably sold its train business is that it makes more money with its foam products (ice chests, industrial foam) than trains.

I disagree. They lost in two seperate fires earlier this year if memory serves.

[Anonymous]

The truth is that whether we like it or not, the model RRing hobby is slowly shrinking, which is why you are seeing consolidation in the industry.

One reason LifeLike probably sold its train business is that it makes more money with its foam products (ice chests, industrial foam) than trains.

[Anonymous]

QUOTE: Originally posted by Grubby

Hopefully these kind of mergers/acquisitions lead to efficiency which in the long term will guarantee a greater return for the companies which will allow continued existence.

It is far better for companies to have product to sell to the MR community than to not exist. Time will tell....

Having product to sell to customers is very nice. But we need orginality that actually works. For example when BLI stomped into the scene a few years ago it changed the hobby mostly for the better.

Now having major companies buy each other out until 3 or 4 mega remain... that cannot be too good.

I suppose after pondering the issue... we should have seen this coming. Why? The products from LL must have had some attraction to Walthers.

Thank you for the tip on MB Klein, I remember his store in Baltimore and look forward to ordering wheels from them.

[Grubby]

Hopefully these kind of mergers/acquisitions lead to efficiency which in the long term will guarantee a greater return for the companies which will allow continued existence.

It is far better for companies to have product to sell to the MR community than to not exist. Time will tell....

[Virginian]

I know nothing of LL Toy Division's past profitability or the terms of the sale. But, I do not get a warm fuzzy feeling. LL WAS a whole lot better to deal with than WKW. I see prices going up. I mean, an E8 should be more than a passenger car, and look at WKW's passenger car prices.
My negative vibes stem from the experience of moves like this being made so people can make more profit with less effort, not to broaden availability or improve service or any of those good things. I think we all better hope that more BLI type enterprises come along in the future or innovation will be a thing of the past IMHO.

[rrinker]

Good idea, I was just thinking of stocking up on some myself. Buy from MB Klein, $4.50 a pack! I can only laugh when I see people bid them up past $9 a pack on eBay, plus another $4 shipping. Even at my LHS which isn't known for low prices, I don't pay $9 a pack, even with tax added.

All I see happening with this Walthers thing is that the prices will go up. Walthers will naturally tack on their percentage to the price as 'distributor' and the price we pay for P2K locos will go up. The prices for P2K at my LHS are too high for me, I'd never buy one there - why? Because they buy them via Walthers already. Compare to the guys who buy direct from LL. Bet that option will go away almost immediately.

--Randy

[Anonymous]

Maybe we will see that QSI Y-6b out of BLI after all.

I have mixed feelings about this sale to Walthers. LL was a good provider.

One thing now.. I need to find and hoard ALL the LL 33" metal wheels I can find before they disappear into the Walthers "Out of stock" or "Retired" hell.

[Anonymous]

QUOTE: Originally posted by Overdurff

Is "China" on the market? Maybe either walthers or Horizon will buy them next and go directly to the source of production!

Or visa-versa -

Maybe China will buy the SELLERS and control it all !!!

Maybe that's their new "5-year plan" !!!!

[CNJ831]

Has anybody stopped to give a thought to the basic situation that must have existed to create an atmosphere where Walthers had the potential for buying out LL? We all consider LL a major player in the hobby and its locomotives are generally held in high esteem and seem to sell well.

Now Walthers is no billion dollar company by a long shot, so LL must have been either actively looking for a buyer or at least sending out vibes to that affect through the industry. To me this says LL could either see the future in model trains tails off or they were already not profitable enough to continue.

I fully expect to see a cascade effect in the near future as the likes of IHC, Model Power, Accurail, Con-Cor, Branchline, et al. give up the ghost to Walthers. And if Walthers past company purchase record is any measure, expect to see very little of each line survive!

CNJ831

[SpaceMouse]

QUOTE: Originally posted by fiatfan

What happens to the lifetime warranty on the Proto engines?

Tom

I've found their lifetime warrantee applies only if it is convenient.

[Anonymous]

I wonder if Walthers will be exclusive for Life Like and Horizon will be cut out???

[fiatfan]

What happens to the lifetime warranty on the Proto engines?

Tom

[cbq9911a]

IMHO, consolidation is coming to the model railroad industry. Expect to see a lot more consolidations, especially smaller "one man band" companies being bought out as the proprietors retire. The only companies I'd guess not to be in play are Atlas and LGB. Also you won't see an MTH - Lionel merger.

[Anonymous]

Well, there goes one of the last mass marketers of electric trains. Walthers will jack up the prices 50% and the stuff will only be sold at your LHS. If mommy and daddy have to go there to get electric trains, the industry will die, taking the LHS with it. [:(][tdn][:(]

[Anonymous]

Is "China" on the market? Maybe either walthers or Horizon will buy them next and go directly to the source of production!

[SpaceMouse]

Although I don't know for sure, in my dealings with Life-Like I got the sense that they were under capitolized. They may have been shopping for a buyer.

[Anonymous]

Or Vice Versa...

Paul

QUOTE: Originally posted by gbailey

So ... when does Kato buy out Atlas ???

[Anonymous]

Get your LL stuff now cause it will be like the rest of Walther's TRASH, "OUT OF STOCK"
They need to change their company Name to Out Of Stock Inc. So much for "N' Products from LL now.

[davekelly]

Actually the incorporation of entities is regulated by the invdividual states. I am assuming that Life Like's corporate structure hasn't changed except that Walthers is now the owner of a controlling portion of the stock. While I'm not familiar with Maryland or Wisconsin corporate regs, I'm pretty sure all that was required was to submit paperwork identifying the new majority stock owner. I doubt very much any approval process that would involve a review of the effects on the marketplace was required.

[Anonymous]

every market in the U.S. has regulation of some kind, even prvately traded companies still have to summit incorporation papers and the like to the the U.S. government. I do not know however how other countries regulate their market practices.

[Anonymous]

So ... when does Kato buy out Atlas ???

[davekelly]

I doubt that the government has to approve the merger or buyout of Life Like and Walthers. As far as I know they are not publically traded entities nor are they in a government regulated market.

[Anonymous]

it doesn't matter if the U.S. Government cares or not, they have to O.K. every merger that happens. so if they think its bad for the market, ( and their bottom line I.E taxes like you stated) they just have to say no to the merger happening, they don't have to explain why or take it any further then that.

[jrbernier]

I would not worry much about an Oligopoly in the model train market. This is such a low percentage of the leisure market that the government does not even care. The only part of this industry that the government cares about is if they are getting their fair share of the taxes!

Jim Bernier

[IRONROOSTER]

QUOTE: Originally posted by orsonroy

QUOTE: Originally posted by IRONROOSTER

I guess acquistion fever has finally come to model railroading. Walthers needed this to secure a low end line. I wonder if IHC or Bachmann is next?
Enjoy
Paul

Bachmann's on the buying end, not the selling. They're possibly the largest toy train manufacturer in the world.

....

I don't disagree with that, but when acquistion fever starts running through an industry, who knows? I've seen some large companies get bought (or "merged"). If Walthers or someone else can get the financing....
Enjoy
Paul

[Anonymous]

I've noticed my local hobby shop with more trains as usual as well, I was thinking it was the summer ru***ho so I don't know, maybe they're getting prepared for Xmas a tad bit earlier this year. also "2 or 3 megacompanies controlling the market" is called an oligopoly(sp?) anyway sometimes it's a good thing( Compaq, Dell ect.) they compete with each other and since they basically have the same *** product the only place they can win customers is price and/or support so now you can get a 400$ with a 2 year warranty or even turn it in +$ in 3 years for a new computer. a bad oligopoly or in some cases monopoly would be power companies, and that's why they're controlled by the government. Now we go to the threats of an oligopoly: in an unregulater market(laiessez-faire) which means "hand's off" an oligopoly can very quickly become a monopoly because one company may develop something that blows their competition out of the water, and buy that company out( we've almost seen this in the video card industry a couple of times). A oligopoly is also much harder to enter into so it lowers the number of firms willing to enter a market(so no more, or very few new producers will come into the market) anywho common oligopolies would be cell phone companies, computer companies and "big-box stores"(like walmart). there is a short term benefit to the consumer in an oligopoly as the megacompanies try to compete with each other, but once they each have a big enough market share competition will cease and we'll all lose. to go back to a point we do not live in an unregulated market so the goverment would stop a monopoly from happening. Also, an Oligopoly does NOT mean there are only 2 or 4 or 5 companies in the market, it only means that 5 or less companies control the market and dictate what direction that market will go in. so basically what I'm saying is in the next couple of years you'll see an increase in quality and a lowering of price of products but it will not last long and the crap will hit the fan if this market truly becomes an oligopoly. Under our current market structure Oligopolies are completely legal and even embraced( people have this funny way of not looking at the longterm).

[Darth Santa Fe]

QUOTE: Originally posted by cnwfan11

QUOTE: Originally posted by simon1966

How much more available can they be? The products from LifeLike are already prominent in the Walthers catalog and the lower end trainsets are already at Walmart and Toys R us.

Funny,since WHEN did these 2 stores EVER carry LifeLike? BOTH dont carry a [censored]thing for model railroaders!!

Toys-R-Us used to carry Life-Like toy trains here. That's where I got my Chessie GP38 and UP 0-4-0. They recently stopped carrying them. And now Hobby Lobby is carrying more trains then usual.[%-)]