Dorel to buy Cannondale
02-04-08, 07:54 AM
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Dorel to buy Cannondale
Canada's Dorel (already owns Schwinn, I think) is offering to buy up Cannondale (and Sugoi clothing) for $200 million.
Press release here: https://www.newswire.ca/en/releases/a.../04/c6603.html
What will it mean for the bikes?
Press release here: https://www.newswire.ca/en/releases/a.../04/c6603.html
What will it mean for the bikes?
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02-04-08, 08:13 AM
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It sounds like the deal is basically done...Interesting that they are creating a separate Canondale division, hopefully this means that the brand won't lose it's luster like Schwin has....
02-04-08, 08:14 AM
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Target or WalMart?
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02-04-08, 08:17 AM
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Maybe K-mart will join the fray?....
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02-04-08, 08:19 AM
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Hopefully the quality wont take too steep a nose dive before I can pick one up at wal-mart. $350 team WalMart issue slice!
02-04-08, 08:28 AM
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^^^Yea, but this doesn't look like just a rumour. The link makes it look like pen has been put to paper...
02-04-08, 08:29 AM
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This is the rumor turning into a deal.
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02-04-08, 08:31 AM
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If you read the article, Cannondale will be a stand alone division focusing on the Independent Bike Dealer Network (IBD) and Pacific Cycles will be the mass market division. I don't think you will see the $300 WalMart Cannondale anytime soon.
02-04-08, 08:32 AM
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How long until the Bedford facility is closed?
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02-04-08, 09:29 AM
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Wohoo! those Cannondales are gonna plastered with the maple leaf and giant owned by Canadians stickers. heh heh heh.
02-04-08, 09:39 AM
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Is this new owner in the business of destroying American cycling industry icons like Schwinn and Cannondale? Will they buy Trek next and destroy them too? Also this is kinda spooky:
>>the transaction, which will be immediately accretive to Dorel's
earnings, is being financed through debt.<<
Oh that'll work. Let's buy a bicycle company on borrowed money. Uh huh. Somebody contact Harvard Business School, the next 'how it's not done' business school case study is unfolding.
>>the transaction, which will be immediately accretive to Dorel's
earnings, is being financed through debt.<<
Oh that'll work. Let's buy a bicycle company on borrowed money. Uh huh. Somebody contact Harvard Business School, the next 'how it's not done' business school case study is unfolding.
02-04-08, 09:46 AM
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The two division strategy is obviously an attempt to keep the perceived value of Cannondale. However, over time, the lines likely will become blurred, and we are likely to eventually see Cannodale go the the way of Schwinn et al.
02-04-08, 09:49 AM
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Ride it like you stole it
That's because Doral didn't buy Cannondale, they really wanted the Cannondale brand! As can be seen here and in every other industry that caters to the consumer market, brands sell!
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02-04-08, 09:50 AM
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Is this new owner in the business of destroying American cycling industry icons like Schwinn and Cannondale? Will they buy Trek next and destroy them too? Also this is kinda spooky:
>>the transaction, which will be immediately accretive to Dorel's
earnings, is being financed through debt.<<
Oh that'll work. Let's buy a bicycle company on borrowed money. Uh huh. Somebody contact Harvard Business School, the next 'how it's not done' business school case study is unfolding.
>>the transaction, which will be immediately accretive to Dorel's
earnings, is being financed through debt.<<
Oh that'll work. Let's buy a bicycle company on borrowed money. Uh huh. Somebody contact Harvard Business School, the next 'how it's not done' business school case study is unfolding.
Much better to leave Cannondale alone - after all, we all need money-losing icons.
What, you though Pegasus Partners rescued them from Chapter 11 just to get cheap road bikes for their friends and family?
02-04-08, 09:59 AM
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You know, I hope this goes well. I love the friggin brand.
In my opinion, what's going to happen is going to be similar to what's going on with fender and gibson, if you guys know guitars.
Squier by fender, are entry level guitars that are decent for the price, but getting a squier doesn't mean that fenders suck. Also, gibson bought epiphone and ephiphone makes some great guitars and it's almost like an epiphone by gibson scenario, as epiphone used to be a very good manufacturer and was bought by gibson.
If we see 'designed by cannondale' bikes in xmart, I wouldn't be too surprised. However, I think it's integral to differentiate the two brands and they know that. You can't have good brand recognition if you ruin a brand. Hopefully they've learned that now...
In my opinion, what's going to happen is going to be similar to what's going on with fender and gibson, if you guys know guitars.
Squier by fender, are entry level guitars that are decent for the price, but getting a squier doesn't mean that fenders suck. Also, gibson bought epiphone and ephiphone makes some great guitars and it's almost like an epiphone by gibson scenario, as epiphone used to be a very good manufacturer and was bought by gibson.
If we see 'designed by cannondale' bikes in xmart, I wouldn't be too surprised. However, I think it's integral to differentiate the two brands and they know that. You can't have good brand recognition if you ruin a brand. Hopefully they've learned that now...
02-04-08, 10:05 AM
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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."
Meaning : We ran Schwinn into the ground after IBD would not stock them if ****mart , had them on the shelves.
We know that we make good money at this , so we are trying a new angle to get in, and if it works we are buying more
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."
Meaning : We ran Schwinn into the ground after IBD would not stock them if ****mart , had them on the shelves.
We know that we make good money at this , so we are trying a new angle to get in, and if it works we are buying more
02-04-08, 10:11 AM
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Well C-dale went Chapter 11 in 2003 so it's not like they were doing so great on their own. The son of the C-dale founder, Scott Montgomery, works for Scott USA now.
02-04-08, 10:15 AM
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The bicycles were doing fine. The Company nearly went down the tubes due to a disasterous attempt at the motorcycle business
https://www.motorcycle.com/news/news825.html
02-04-08, 10:23 AM
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The interesting part is that they are creating Cannondale Sports Group, in which they're placing C'dale + GT + "other quality brands" (one can assume Mongoose), and they will "seek acquisitions in similar high quality, performance bicycle companies". The former prez of Pacific Cycles will run that group.
The run-down: Dorel's furniture business is suffering bad, their juvenile products are doing ok, the rec/leisure segment (where the bikes are) is doing good. So bikes replace desks and beds.
The run-down: Dorel's furniture business is suffering bad, their juvenile products are doing ok, the rec/leisure segment (where the bikes are) is doing good. So bikes replace desks and beds.
02-04-08, 10:33 AM
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Of course, it's a Canadian ploy to destroy American icons. Scratch the paint, you may even find some government investment behind it all...
Much better to leave Cannondale alone - after all, we all need money-losing icons.
What, you though Pegasus Partners rescued them from Chapter 11 just to get cheap road bikes for their friends and family?
Much better to leave Cannondale alone - after all, we all need money-losing icons.
What, you though Pegasus Partners rescued them from Chapter 11 just to get cheap road bikes for their friends and family?
02-04-08, 10:36 AM
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The bicycles were doing fine. The Company nearly went down the tubes due to a disasterous attempt at the motorcycle business
https://www.motorcycle.com/news/news825.html
https://www.motorcycle.com/news/news825.html
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02-04-08, 10:47 AM
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a lot of countries do this and pay it off eventually.
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https://sanfrancisco.ibtimes.com/arti...ger-photos.htm
