3 Jun 2015
In Conversation with Bob Saxon
After news was released last week that International Yacht Collection (IYC) and Cape4 Yachting would be merging with a new brand to follow after the summer, I took the opportunity to speak with Bob Saxon, past president of IYC to discuss the acquisition and what's next for him.
What can you share about the past 12 months during the transition with Trinity at IYC?
It's been a quite challenging directing and operating a company that has been so high profile for sale the past three years that I've been here. The IYC business model was a good one when Trinity was building and delivering eight to 10 yachts a year. However, after acquiring IYC from Steve Hudson seven years ago they had a place to hand off their owners for charter, management and eventual sale once those clients had run the ownership cycle. Prior to the IYC/Trinity collaboration, many of those same owners may have gone to outside brokerage firms and lost contact with Trinity. Unfortunately, timing being what it is, Trinity acquired IYC at the dawn of the deep recession that shook the megayacht market and Trinity's production fell off dramatically as did all of the U.S. Builders. IYC then morphed into an afterthought, especially with the arrival of the new investor, Littlejohn, whose focus was entirely on commercial and military applications, and thereafter IYC became an unnecessary part of the company's portfolio. Despite the blows, we've been able to hold our own and remain counted amongst the industry Top 10 worldwide.
When you first heard of the strategic merger what was your first reaction, as well as that of the key team members?
From the day the intent to merge became common knowledge, it was always and continues to the present in my opinion, to be the antidote for what had become a flawed business model. I preached a sermon to my managers that it was, "The best news for IYC that can be imagined." I believe that Cape4 Yachting understood the dynamics of IYC's history and saw the company for what it was: a diamond in the rough.
What was your role in the merger and due diligence process? What did you learn about the strategic approach of bringing two businesses together?
Billy Smith and John Dane were clear with me that they wanted this to happen and I pledged to myself and to them that I would play a leadership role in the due diligence process regardless of what my future role might be. I was familiar with the due diligence process having brought two companies with complementary resources together in a marketing alliance when I owned Bob Saxon Consultancy and of course prior to that, having sold Bob Saxon Associates to Camper & Nicholsons International. At IYC, we set forth as a team to make every effort to see that IYC would meld effectively and seamlessly with Cape4. I am very pleased with the results.
What do you think this will do for the IYC business and how quickly do you think it will have an impact?
With the advent of Cape4 Yachting, IYC immediately steps out of the shadow cast by Trinity wherein the perception in the marketplace might have been pressure exerted from the parent group on IYC to sell or charter Trinity's as a priority. While that perception was nearly non-existent and far greater than reality, it was there nonetheless. It was a common refrain and objection I heard when I was out recruiting new brokers and it inhibited our growth. That misguided notion can now be cast aside and it should help in their recruiting new talent. Cape4 also brings considerable strength in the Eastern Med with their network of offices, and extensive experience in marine insurance which should create a decidedly stronger luxury presence.
Where do you think the Cape4 management will add value to the IYC team?
I think their philosophy to cast aside traditional practices in regards to sales and client relationships will work well for them. They believe, as I do, that what we said and did to bring buyers and charterers forward just a short seven to eight years ago is no longer effective. This is a difficult market and in spite of the economic resiliency in the United States, thus far no yachting services company has effectively tapped in to the lux buying habits of affluent Americans to any marked degree relative to the abounding wealth of the U.S.
What does the future hold for Bob Saxon in light of the merger?
The owners of Cape4 Yachting appear to have a "vision" and I learned long ago not to interfere with another man's dream of success. There's been some discussion about my having an advisory role at IYC but I am not going to let that preclude me from considering other opportunities in the industry suitable to my skill set.
Where would you like to be and what can you offer to the market going forward?
I'll take a deep breath and a step back and then see what might come my way. There have been two very recent overtures but nothing yet has captured my imagination. China as investors in our market and Cuba as a future viable charter destination are of interest as side notes. Without doubt I am going to step up my public speaking requests and journalistic opportunities, both of which are labors of love, as I have some pointed opinions about our industry and where we should be headed. Maybe I'll lead some great cause where my executive skills and history of representing some 2,000 owners over the years for charter, sales, or management might be of interest to a company.
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