Audio Research Financial Troubles

@tunehead -- Sorry to appear dumb, but what is CAM?

Fellow members, with the apparent glut of used ARC gear for sale, what would you consider to be the best Tube Phono Preamp "bargain" available?  I recently acquired an ARC SP-17 preamp and McIntosh MC-225, and I've been told the phono preamp in the SP-17 is pretty good.  Do you agree with that statement?  If not, back to my original question -- what is a solid older ARC phono preamp and what is the usual price range?

Thanks in advance!

Allen 

allenf1963,

CAM is Canuck Audio Mart.

Brad

The reason there are a lot of ARC products for sale right now:

1) 50+ years of mass production (yes had built but massive production) means LOTS of components worldwide are for sale

2) We are in a global slowdown. Especially Europe where ARC sold many more components than in the USA. High end HiFi is "for sale now" ie: a buyer's market.

3) Tubes are hard to get thanks to the BS in the Ukraine. This substantially raises the cost of owning tube gear. (see #2) 

4) Recently many digital products have gotten as good sounding as tube. Moors Law days digital gear will continue to get better and cheaper. Bonus: no re-tubing. 

5) Old guys who love tubes for nostalgia sake (I'm one of them) are loosing their hearing and dying off. The young bucks think Mac Pro Bluetooth headphones are HiFi. I own a pair- they are really good! It costs tens of thousands of dollars in separates to duplicate their sound. 

6) Tube gear is expensive to own and fix. Like buying a Ferrari. You can get a really good carbureted 8 cylinder under 200k or 12 cylinder for under 400K which is affordable to many. However the engine-out services @ $50K every 20K miles, the $300/hr. mechanic costs, insane cost of OEM parts, unobtanium parts ie: tires like the MXVs used in the 80s all cost insane money to buy.  Likewise ARC charges as much or more than a good 90's vintage pre or power amp is worth to get them "into spec". There was until recently an 8 month wait list to get your gear into ARC for authorized repair and calibration. 

For all these reasons ARC gear is "on sale" now. Ref 250s can be had at 7K, Ref 6s can be had at 6K, DAC9/CD can be had at 5K. Ref 210 mono blocks go for 5K person to person. 5700-6000 through TMR and the like. Prices continue to drop rapidly on the 10+ year old items. Add to that ARC made "entry level" gear as well which sells for very low $. 

ARC is now well capitalized and have retained most of their long term talent. Their Reference lines are better than ever and they are offering upgrades to their Ref 150 line which I'm told sound breathtaking. There is a waiting list. The Ref 320 will cost north of $50,000 each and I'm told by a friend there in MN that there is a long waiting list for them.

Negotiate aggressively. Guys who have to sell will take a hit and you will wind up owing some really fine gear for cheap. . 

@ghdprentice

Audio Research’s problems are long over. Nothing to do with the viability of the business, but of a highly leveraged buy out by a great guy with the best intentions and a change in the interest rates.

Respectfully submitted, while I am hopeful that ARC will flourish under its new owner, I am wondering why you think their problems were due to the original financial leveraging of the company.  I see it as the opposite, as a low amount of debt.  Perhaps a balloon payment falling due that could not be refinanced? 

From reading online, at the time of receivership ARC had secured bank financing of $1.6M.  Even assuming a sky-high interest rate of 20% that is only $320,000 debt service a year.  I realize there was also $1M of unsecured debt, but I would think that was the result of operational problems, not from the original purchase.

All things being equal, I would think this should be easily met for a company whose products sell for between $6,000 to $85,000 per unit.