Outboard Marine Corporation

Product Details

Historical Context

Outboard Marine Corporation sometimes referred to as Outboard Motor Company was formed in 1929 when ELTO was merged with Lockwood-Ash Motor Company. They began using the name OMC in 1956.

Outboard Marine Corporation was the world's largest manufacturer and supplier of outboard motors and second largest producer of powerboats. Based in Waukegan, Illinois the company had become famous for its brand-name Johnson and Evinrude outboard motors, as well as its Chris-Craft and Grumman powerboats. Other products under the brand names of Four Winns, Seaswirl, Trade Winds, Sunbird, Stratos, and Hydra-Sports include fiberglass runabouts, cruisers, performance boats, and craft for offshore fishing. Outboard Marine also marketed clothing for boating, and resort wear.

Unfortunately, during the late 1980s and early 1990s, Outboard Marine had a difficult time keeping up with the competition, notably archrival Brunswick Corporation, currently the world's largest manufacturer of powerboats.

In April 1997 OMC hired Salomon Brothers to explore future option such as a buyout or merger. In 1997 Detroit Diesel made a $16 a share bid for OMC. They were outbid at $18 a share by Alfred Kingsley who previously owned 2 million shares purchased at $17 a share and had no experience in the outboard industry. The deal was backed by George Soros. Carl Icahn, a corporate raider who bought TWA in 1988, is said to blame Kingsley his lieutenant during the 1980s for the ensuing TWA bankruptcy a few years later. David Jones, former Mercury Marine Division president until August 1997, was hired by Kingsley in September 1997 to become the President and CEO of OMC, but resigned in August 2000 due to financial turmoil at OMC. In March 1998 OMC laid off 200 employees after earlier laying off 348. In September 1998 OMC announced the closure of their Milwaukee, Wisconsin and Waukegan, Illinois plants over the next two years.

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