Motorsports Authentics may go belly up

In an all-out effort to avoid bankruptcy, the joint owners of Motorsports Authentics (MA) are attempting to reorganize the troubled licensed merchandise company and settle the millions of dollars it owes several NASCAR teams. MA's 50-50 owners, International Speedway Corp. and Speedway Motorsports Inc., have been in constant contact with the top teams since the end of the season, with one of NASCAR's top executives, senior vice president Paul Brooks, acting as a mediator. It's uncertain exactly how much MA owes the teams, but its contracts with the best-selling organizations such as Hendrick Motorsports, Roush Fenway Racing and Dale Earnhardt Inc. guarantee each of them close to $3 million annually, industry insiders say. MA, which has lost money in three of its four years in existence, has been paying a portion of those guarantees, about a third to half, based on their merchandise sales. Officials from ISC and SMI declined comment, citing the continuing nature of the negotiations. But team officials characterize the talks as frustrating because there remains no clear merchandise plan for the sport and the season-opening Daytona 500 is less than two months away. MA is responsible for most of the sport's trackside retail activity and much of its licensed merchandise, although that model could change as part of the company's restructuring. Most team officials say they're willing to forgive some of the debt from MA, but they need a clearer understanding of the plan going forward before agreeing to a settlement. MA generated more than $200 million in revenue in 2008, the only year it has turned a profit, but MA's revenue this year will be a little more than $100 million, industry insiders say. The die-cast division accounts for a little less than half of the company's revenue. Sporting News / SportsBusiness Journal