The global bicycle market, already in consolidation mode in recent years, is poised to take another spin in that direction this year if the Dutch parent of the Gazelle, Faraday and Cervèlo brands among others is successful with its latest acquisition target.
Pon Holdings, last week, confirmed its $899 million (845 million euro) bid for the Accell Group, parent of the Batavus, Haibike and Raleigh brands that sells an estimated 1.5 million bikes annually and generated annual sales of $870 million in 2016. A combined Pon-Accell would scale the top of the global bicycle peak with annual unit volume of more than 2.3 million and pose a challenge to industry leader Giant in annual revenue volume.
Traditional bike sales have reportedly been stagnant in the major European bike markets of Germany and The Netherlands for years, but revenues have risen on the rising popularity of electric versions. Dorel Group, parent of Cannondale, suffered a 6 percent sales decline in its Dorel Sports segment to $939 million in 2016. The Montreal company cited challenges in dealer purchasing patterns, industry-wide discounting due to excess supplier and retail inventory and “generally soft bike market overall” for the drop. In February, the France-based Rossignol Group acquired Southern California-based Felt Bicycle and its estimated annual sales of more than $60 million, for an undisclosed price. The deal came less than two years after Rossignol entered the bike market with its 2015 purchase of Time Sport.
According to Sports Insight Extra estimates, the top five bicycle companies worldwide generated more than $5.5 billion in 2016 revenues, led by Taiwan’s Giant at $1.85 billion. A combined Pon-Accell would jump over Trek and Dorel into the second slot in annual sales volume.