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LAKE FOREST, Ill., Dec. 22 /PRNewswire/ -- Brunswick Corporation
BC announced today that it had reached agreements with two groups of
boat builders who have asserted antitrust claims against the company related
to the sale of sterndrive and inboard engines; these groups purchased 80
percent of the relevant engines in the outstanding litigation. As a result,
the company said it would record an after-tax charge to operating earnings of
approximately $40 million in the fourth quarter of 1999.
Under the terms of the first agreement, the company will pay $30 million
to members of the class action suit filed on behalf of certain boat builders.
Settlement of this case is subject to approval by the court. Under the terms
of the second agreement, the company will pay the members of the American
Boatbuilders Association (ABA) $35 million.
As previously reported, Brunswick is appealing the award by a Little Rock
jury of trebled damages under the antitrust laws of $133 million to a further
group of boat builders, Independent Boat Builders, Inc. (IBBI). Should the
verdict be reversed by the appellate court, the company would not have any
liability to IBBI, nor would it make any additional payments to the ABA.
If the company ultimately makes a payment to IBBI in excess of $35 million
as a result of a final judgment or settlement, the company will make an equal
payment to the ABA, less the $35 million already paid to the ABA. If the
company makes a payment to IBBI in an amount less than $35 million, the
company will not be required to make any additional payment to the ABA.
"We are pleased that these agreements achieve two major objectives.
First, these boat builders are very important customers of ours, and the
agreements resolve all outstanding issues and allow us to focus on meeting
their future needs. Second, the agreements reduce substantially the potential
liability associated with this series of lawsuits, thereby reducing the
potential financial impact on the company," said Brunswick Chairman and CEO
Peter N. Larson.
Headquartered in Lake Forest, Illinois, Brunswick is a multinational
company serving outdoor and indoor active recreation markets with leading
branded consumer products that include Zebco and Quantum fishing equipment;
Igloo, American Camper and Remington camping gear; Igloo coolers and ice
chests; Mongoose and Roadmaster bicycles; Brunswick bowling centers, equipment
and consumer products; Brunswick billiards tables; Life Fitness, Hammer
Strength and ParaBody fitness equipment; Sea Ray, Bayliner and Maxum pleasure
boats; Baja high-performance boats; Boston Whaler and Trophy offshore fishing
boats; Mercury and Mariner outboard engines; and Mercury MerCruiser
sterndrives and inboard engines.
SOURCE Brunswick Corporation
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