The Dutch Pon Holdings group and the Canadian conglomerate Dorel Industries officially announced on Oct. 11 that Pon.Bike (brands Cervélo, Focus, Gazelle, Juliana, Kalkhoff, Santa Cruz, Union, etc.) will acquire Dorel Sports (brands Cannondale, Caloi, GT, Mongoose, Schwinn, etc.). According to the two parties, this mammoth marriage will create “a leading global bicycle company with sales of approximately €2.5 billion.” The acquisition, for which the Dutch private company is putting around one billion Canadian dollars ($810m-€701m) on the table, is expected to close before the end of the first quarter of 2022.
The deal came after the board of directors of Dorel Industries broke up negotiations with Cerberus Capital Management to take the Canadian publicly trading company private. The Schwarz family, which owns a controlling interest in Dorel, did not participate in the decision last February. Supposedly, Dorel Industries will continue as a public company whose operations will be reduced to the sale of children’s furniture and other products.
Dorel Sports includes the Cycling Sports Group (CSG), which supplies indepdendent bike dealers, and the Pacific Cycle Group (PCG), which supplies mass retailers (including those outside the industry). While Cannondale, a premium brand owned via CSG, is well-positioned globally, the ”historic” U.S. brand Schwinn, owned by PCG, is considered “number one in awareness” in its home market. The same rich history applies to the Brazilian bicycle manufacturer Caloi, which is not only the market leader in its home country but also occupies a leading position throughout Latin America, where it also distributes some of Dorel’s brands.
Unlike its parent company Dorel Industries, Dorel Sports is not headquartered in Montréal, Canada, but in the U.S. in Wilton, CT. Dorel Sports’ annual sales are $1.2 billion, only slightly below those of Pon-Bike.
Pon Holdings has been building a global portfolio of leading bicycle brands for more than a decade. Today, its bicycle subsidiary Pon.Bike employs about 2,400 people and generates annual sales of around €1.5 billion. E-bikes account for 70 percent of the turnover.
Originally involved in automobile imports, Pon became involved in the bike business in 2011 through the acquisition of Gazelle, the largest bike brand in the Netherlands, followed by the takeover of Cervélo. It made a major move in the sector one year later by acquring a controlling interest in the former Derby Cycle, the parent of Kalkhoff, Focus and other bicycle brands.
It showed higher ambitions a few years later by proposing to take over a large stake in the public Dutch-based Accell Group (brands like Batavus, Lapierre, Winora and Diamondback as well as Raleigh, which was previously part of Derby and was divested later on). The talks with Accell were broken off in 2017. Pon owned a 5 percent interest in Accell at the time. Reacting to the failure of building up a larger Dutch-based bike empire, the multi-millionaire chairman of Pon, Wijnand Pon, then reportedly accumulated a 20 percent stake in Accell in only ten days’ time
Most recently, in August 2021, Pon.Bike also acquired Mike’s Bikes, an American bike dealer with 270 employees and 12 points of sale. The U.S. specialty retail chain is also a strong online player and has its own brand, Public, among other operarations.
