The company plans to emerge from the process within two months under new ownership, held primarily by current lenders. It also seeks $570 million in new capital through a Restructuring Support Agreement (RSA) with many of its debtholders.
Hoonigan became part of Wheel Pros, LLC, in October 2023 after a rebrand. Wheel Pros, which designs and sells aftermarket wheels, tires, and accessories, merged with Hoonigan in 2021 during a period of rapid growth. However, according to CEO Vance Johnston’s affidavit, the company struggled with operations, despite significant expansion.
Clearlake Capital acquired Wheel Pros in 2018, and the company made five acquisitions between 2018 and 2020. It also invested in two U.S. facilities, spending $12 million, but both proved financially unviable. One facility was divested in 2021, and the other was closed in early 2023.
Hoonigan, like many companies, saw growth during the pandemic but faced challenges with supply chain issues and rising costs. Aluminum prices doubled between 2020 and 2022, and although revenue jumped from $844 million in 2019 to $1.5 billion in 2022, demand fell sharply in 2023, leading to missed earnings targets.
The RSA aims to stabilize the company’s finances and allow it to continue operations without affecting employees, customers, or suppliers, but its future now rests with the court.
Source: Motor1
