The private equity curse continues, as Accell Group fails to find a buyer after being bought out by a consortium just as the pandemic bubble went bang.
Bought in 2022 by a consortium led by New York-based KKR as famine turned to a glut of stock, Accell Group have now been granted a suspension of payments by Dutch courts just four years later.
The KKR-led group purchased Dutch cycling conglomerate Accell Group in 2022 for 1.1 billion Euro, largely based on the unprecedented growth in bike sales during the COVID pandemic. Accell then owned brands such as Lapierre, Ghost, Haibike and Raleigh, amongst others.
Accell Group announced yesterday that it was unable to meet its payment obligations and was granted a suspension of payments by Dutch courts. This is similar to insolvency in the Netherlands. Think of this as a restructure, overseen by said courts. Either way, it’s not great news in four years of redundancies and financial losses.
Accell’s lenders gained control back in February, the second financial restructuring within the space of 12 months. KKR bought the group for 1.1 billion Euro and then poured in another 700 million or so to keep the business afloat, meaning that they have lost 1.8 billion since 2022.
Booming ebike sales, the very thing that this bet was pinned on, failed. Shortages in some components, exacerbated by overstock in others followed by gouging prices to clear stock, all the while devaluing it, is now what can be seen as a classic COVID pandemic symptom.
Accell UK & Ireland closed its P&A wing in 2023 after the most recent restructure, which was a foreshadowing of the issues the larger group was facing. They now will likely look to appoint an administrator to oversee what happens next.
What happens next is anyone’s guess. It’s never nice to see legendary brands go down with a sinking ship and we mostly think of our pals and the people who face an uncertain future as their jobs hang in the balance.
