Kalkhoven & Forsythe Buy Pi Group

[Dov]

From speedtv.com

[jjspierx]

http://www.grandprix.com/ns/ns14020.html
Another article...mostly the same stuff.

[macdaddy]

Someday these two guys will be inducted into the Hall of Fame.

[Kicking-back]

Good news.

Pi is a great company - founded originally by Tony Purnell, hence the name.

[Snrub]

Wat implications does this have for Bosch's involvement in CC? You may have noticed that currently all the car's have Bosch logos on them because they're running Bosche ECUs. (I think in the past they ran Motecs)

[macdaddy]

I always just assumed that they were only providing spark plugs!

[Kicking-back]

But the cars already run Pi data logging/telemetry.

[mountainstar]

Pi is a nice profitable company too.

[The Snout]

So when's Bridgestone go up for sale, so we can buy that too.

[Dov]

Have you guys noticed that since KK and GF have become more involved, the less we hear coming out of PG's mouth!? I think it was macdaddy who mentioned in an earlier thread that it wouldn't surprise him if Paul G. is bought out by the 2 other amigos and i'm starting to think that he may be onto something.

[Emfa]

Originally Posted by Dov

I think it was macdaddy who mentioned in an earlier thread that it wouldn't surprise him if Paul G. is bought out by the 2 other amigos and i'm starting to think that he may be onto something.

Don't moderators here get a bat-phone so they get the latest insider news?!?!?

What I'm wondering is - when will the money run out from the spending spree that the 2 amigos have been on?

[mountainstar]

Originally Posted by Emfa

Don't moderators here get a bat-phone so they get the latest insider news?!?!?

What I'm wondering is - when will the money run out from the spending spree that the 2 amigos have been on?

Well seeing how Forsythe has several billion dollars in assets and Kalkhoven is up there too, not for a while. And it's money well spent for already profitable companies with a diversified base of business.

[macdaddy]

I remember posting that Dov. I think the thread was "Predictions for the Offseason" or something like that. It was a totally off-the-cuff remark that I made from 0% fact, 100% intuition.

And I still think it's going to happen.

THIS offseason.

[Roninho]

Originally Posted by mountainstar

Pi is a nice profitable company too.

So? That will be included in the price as well.

[david_james2000]

Originally Posted by Dov

Have you guys noticed that since KK and GF have become more involved, the less we hear coming out of PG's mouth!? I think it was macdaddy who mentioned in an earlier thread that it wouldn't surprise him if Paul G. is bought out by the 2 other amigos and i'm starting to think that he may be onto something.

Isnt PG more involved with running the Trans-AM Serise and is just a silent partner of the three

[f1manoz]

PG certainly wasn't silent a few months ago! But he certainly has been quiet of late, and certainly doesn't appear to be involved in any of the purchases that has taken place thus far.

No real idea what the Pi Group is, but if it's profitable and helps ChampCar, then it's a good buy!

[Snrub]

I didn't realize that the telemetry was from Pi.

Originally Posted by The Snout

So when's Bridgestone go up for sale, so we can buy that too.

Lol! Heck Ford may be bankrupt in a few years too.

[Dov]

Originally Posted by f1manoz

No real idea what the Pi Group is, but if it's profitable and helps ChampCar, then it's a good buy!

Hey f1manoz,

Here's all you need to know about the Pi Group.

Dov

[JohnSSC]

Lost in the euphoria of the purchases of Pi and Cosworth is I think a salient point: These purchases may be part of a business plan, but not necessarily one which has OWRS as the centerpiece.

As has been noted time and again, Los Dos (formerly Tres, it seems) Amigos are Businessmen. They have their own companies and they have their own capital which they use to buy and sell things. One of the things they bought was CART. This has opened other doors for them, namely the purchase of Cosworth and Pi. While it is beneficial to OWRS that KK has done so, the purchases in and of themselves were of going profitable concerns that can stand by themselves with OR without OWRS. Imho, it is not sound logic to presume that these purchases were made strictly to support OWRS or to make OWRS the centerpiece of the holdings.

When you think of it, OWRS is the weakest piece of the puzzle and would have minimal impact financially were it to be divested or terminated. The myriad of services that Cosworth and Pi provide do not need OWRS for them to continue to do so.

KK and Forsythe are businessmen who saw an opportunity and moved on it.

[The Snout]

KK has suggested that point recently in a AR1 interview John. Each is it's own going concern and need to profit on it's own.

[macdaddy]

KK also made that quite clear on WindTunnel recently.

[Ac.]

JohnSSC, your points are not invalid, but the comments made by KK and GF regarding these purchases are not unexpected. Smart business people do not purchase companies that are dependant on a single customer, particularly when that customer is struggling through a difficult time.

I would suggest that the decisions to purchase Cosworth and Pi were 100% driven by the desire to build a strong base for Champ Car, but that Kalkhoven and Forsythe would not have made the purchases if those companies were not capable of standing on their own without CC. That's just smart decision making.

It is a common business practice today for a company to own others that support its core competencies. The company I work for is in foodservice distribution(we deliver product to restaurants), yet we own meat packing facilities. The meat packing business stands on its own and serves many customers, yet its primary reason for being part of our organization is to provide us product.

I would say that the same is true of Cosworth and Pi for Champ Car, they will serve many customers and make a profit, but they were acquired to support the series.

[JohnSSC]

The point I was making was not to question the wisdom of the purchases, but the wisdom of presuming that the purchases were made strictly to support CC.

I think in any profit/loss analysis, CC is the weakest holding. The tone I get from reading here is that the focus is on CC and that these purchases somehow ensure it's survival. While these purchases provide a good support-system for the OWRS product it should be clear (imho) that if OWRS can't hold it's own from a profitability standpoint, it is gone.

They have already shown that there is no real loyalty to any of the "tradition" that CART had - venues that the Series was known for have been dropped left and right for more profitable venues.

If OWRS does not bring a handsome return on the investment it will be gone just like RA, Mid-Ohio, etc.

[macdaddy]

If OWRS does not bring a handsome return on the investment it will be gone.

The same could be said of any racing series, no? Or of any business, of any kind, anywhere?

And I think it is very wise (albeit sad) to let go of some of the "loyalties" to "traditions" that were CART. Where is CART now?

[Kicking-back]

CART is dead, sadly.

Some of the elements of ChampCar are clearly descended from it, but essentially what we'll have now is increasingly going to be a steet racing series.

In fact - maybe it would help to market it as that, as it is a USP over every other, if streets are the only type of racing CC does.