January 13/04 1:31 am - Montreal's Dorel Industries Buys Pacific Cycle
Posted by Editor on 01/13/04
Pacific Cycle Acquired by Dorel Industries
From the official press release and other sources:
January 13, 2004 (Madison, Wisconsin) - Pacific Cycle announced today that it is being acquired by Montreal-based Dorel Industries Ltd. (TSX: DII.A, DII.B; NASDAQ: DIIBF), a global supplier of juvenile and home furnishing products. Dorel has signed a purchase agreement to acquire the Madison-based Pacific Cycle, a leader in the design, marketing and distribution of high quality, branded bicycles and other recreational products for $310 million US in cash. Dorel's purchase of Pacific Cycle is expected to close later in January. Chris Hornung, Founder and Chief Executive Officer of Pacific Cycle, will remain at the head of Pacific Cycle and will run the company as a stand-alone Dorel division.
Best known for its Schwinn, Mongoose and GT bicycle brands, Pacific Cycle sells more bicycles than any other company in North America. Pacific Cycle accounts for 27% of U.S. bicycle sales, including 44% of mass market sales (it also owns the Roadmaster, InStep, Pacific and Murray brands). Annual sales are more than US$325 million.
Hornung said that the acquisition begins another exciting chapter in the company's corporate history. "This acquisition provides numerous opportunities to significantly strengthen Pacific Cycle's position as a branded consumer products company with world-class sourcing and distribution. It supports the entrepreneurial spirit that is intrinsic to Pacific Cycle's success throughout our 27-year history."
"I am very proud of Pacific Cycle and of the people who have worked together to make Pacific one of the largest bicycle companies in the world. We will continue to grow Pacific with the additional resources Dorel provides," said Hornung. "Our business model is very similar to that of Dorel's and this transaction provides a larger resource base to significantly strengthen our position as a global consumer product leader."
Hornung made special mention of the backing Pacific Cycle received from its outgoing partner Wind Point Partners, based in Chicago, Illinois and other shareholders such as the State of Wisconsin Investment Board (SWIB). "Partnering with Wind Point Partners and local support from the State of Wisconsin Investment Board was critical in acquiring Mongoose and Roadmaster in 2000, Schwinn and GT in 2001, and in 2003, InSTEP, a leading producer of jogging strollers and bicycle trailers," said Hornung.
About Pacific Cycle
Established in 1977, Pacific Cycle, LLC is the U.S. number one supplier of quality bicycles. It designs, markets and imports a full range of bicycles and recreation products under the brand names of Schwinn, GT, Mongoose, Mongoose Pro, Pacific, InSTEP, Roadmaster, Flexible Flyer, Powerlite, Murray and Dyno. Pacific Cycle is headquartered in Madison, Wisconsin with offices in Olney, Illinois and Lake Forest, California. It has distribution centers in Olney, Illinois, and Vacaville, California, and a design/test center in Longmont, Colorado.
Dorel designs, markets, and distributes brand name consumer products globally. It specializes in two market segments: juvenile products and home furnishings. Dorel's extensive product offering includes juvenile products such as infant car seats, strollers, high chairs, toddler beds, cribs, infant health and safety aids, play-yards and juvenile accessories; home furnishings such as a wide variety of Ready-to-Assemble (RTA) furniture for home and office use as well as metal folding furniture, futons, step stools, ladders and other imported furniture items.
Dorel employs approximately 4,800 people in fourteen countries. Major North American facilities are located in Montreal, Quebec; Toronto and Cornwall, Ontario; Columbus, Indiana; Wright City, Missouri; Tiffin, Ohio; Dowagiac, Michigan; and Canton, Massachusetts. The Company's major divisions in the United States include Ameriwood Industries and the Dorel Juvenile Group (DJG USA), which incorporates the Cosco and Safety 1st brand names. In Canada, Dorel operates Ridgewood Industries, Carina Furniture Ltd. and Dorel Home Products. European operations are carried out through the Dorel Juvenile Group (DJG Europe) located in Holland and the Ampa Group, which has major facilities in France, Italy and Portugal. Brand names marketed in Europe are Maxi-Cosi, Bébé Confort, Quinny, Safety 1st, Babidéal, MonBébé and Baby Relax. Dorel's imported furniture business is carried out through Dorel Asia.