2.27.09 - LGB's American Return? Not So Fast...

It seems that good news is invariably followed by bad. A few months ago, it was announced that LGB would finally be returning to North America after years' absence following the insolvency and liquidation of Lehmann. LGB was acquired by Marklin in 2007, but reentry to the North American market was delayed due to trademark issues. Once those were resolved and Walthers was named the American distributor, it appeared that the tumultuous narrative of LGB's sale was starting to settle down. However, looks can be deceiving. Earlier this month, Marklin itself filed for insolvency.

Marklin's insolvency proceedings are proving to be as dramatic as LGB's. Coincidentally, both companies' insolvencies happened during significant anniversaries: LGB during its 125th year, Marklin during its 150th. During the weeks following the takeover of Marklin by a court-appointed trustee, a complex web involving investors Kingsbridge and Goldman Sachs, hefty consultants' fees, and the always suspicious transfers if large sums of money has started to unravel. But for those of us whose main interest is the trains, the signals are green, for now at least. Production and other day-to-day operations at Marklin are continuing while the company is being restructured and a buyer is pursued. Product is supposedly on its way to North America and sellers are preparing for inventory. The distributor Walthers and resellers such as Wholesale Trains and Pizza Trains already have price lists and estimated arrival dates online. The question now is whether or not that inventory will ever actually get to America and, if it does, if there'll still be an LGB to support it.