BikeBiz Bicycle and cycling retail news
Canada’s Dorel Industries has acquired the Cannondale Bicycle Corporation.
Headquartered in Connecticut, Cannondale has facilities in Bedford, Pennsylvania as well as offices in Canada, Switzerland, Holland, Japan, and Australia.
The purchase also includes Sugoi Performance Apparel.
The total value of the all-cash transaction will be $190m to $200m, subject to Cannondale’s earnings results for the year ending June 30th.
The transaction, which will be immediately accretive to Dorel’s earnings, is being financed through debt. Cannondale and Sugoi are being purchased from an affiliate of Pegasus Capital Advisors, which acquired the company in 2003. 2007 sales for Cannondale and Sugoi
were approximately $200m
Dorel’s Recreational/Leisure segment is being split in two. The Cannondale Sports Group will be IBD-only. Pacific Cycle become a stand-alone division with an exclusive focus on mass merchant customers.
Dorel CEO Martin Schwartz said:
“The Cannondale purchase is consistent with Dorel’s plan to concentrate on its core businesses. Since buying Pacific Cycle in 2004 we have learned a great deal about the bicycle industry and have found it to be a true value driver for Dorel. We are committed to pursuing this sector, and this important transaction will position us globally in a most material way.
"Dorel recognizes the importance and potential of the Independent Bicycle Dealer channel and is purchasing Cannondale as the first step to become the world’s number one IBD player. Cannondale will be the crown jewel of this new Dorel division, which will seek additional such growth opportunities.”
