Growing Number of Acquisitions in Bicycle Industry
DOETINCHEM, the Netherlands – Clearly there’s something brewing in the bike sector, both in Europe as in the US. That something drastic is happening is indicated by the growing number of takeovers. Only recently again a renowned bicycle brand changed hands.
That brand is American Felt Bicycles. The Rossignol Group SA (owner of several brands for winter sports products, such as Dynastar, Kerma and Lange) has reached an agreement with Felt on the takeover.
Felt is the second bicycle brand of Rossignol which earlier took over Time Sport International; the owner of Look.
American cycling market struggling
The acquisition of Felt has everything to do with the fact that the American market is struggling. Even to the point that the two biggest players in this market – Trek and Specialized – already have indicated to postpone their introduction of model year 2018 bikes and e-bikes to well into the autumn.
This should present bicycle retailers time to sell their still high stocks.
Problems for American bicycle retail
Another indication on a troubled 2016 for bicycle retailers in the US is the acquisition of retail chain Performance Cycles by Advanced Sport International (ASI). ASI owns, among others, the brands Fuji, Kestrel and Breezer and is now continuing this chain of 106 stores. The troubled situation at American bicycle retailers is mainly caused by rapidly growing online competition. This also caused renowned chains like Sports Authority (460 shops) and Sport Chalet (47 shops) to go under.
Pinarello, Multicycle and MIFA
Closer to home the recent take-over of Pinarello stands out. In particular as the new owners focus on the ‘rich and famous’. This new owner is the investment company L Catterton which also owns Dior, Louis Vuitton, Hublot, Moët & Chandon and several other brands for the well-to-do.
In the Netherlands one of these days it will be announced who is going to restart or takeover Multicycle. The same goes for German MIFA (owner of the e-bike brand Grace and Steppenwolf for sports bikes, but mainly a large producer of supermarket bicycles). About MIFA it is said that the biggest bicycle manufacturer of India, after previous acquisition negotiations in 2014, is now back in the race to continue the company. Hero Cycles wants to become also in Europe a major player in the bicycle market. For this the company acquired the English Avocet Sports in 2015 and recently opened a European R&D centre in Manchester.
Excellent market prospects
It’s clear that in the next few years there will be no end to the series of takeovers and acquisitions in the bicycle sector. Especially in Europe as market prospects are good. Market researches of renowned institutes assume a 40 to 50% growth for the coming years up to 2020. This expected growth has everything to do with higher sales of electric bicycles and with increasing traffic congestion and parking problems in urban areas of which bicycles sales will profit.