Editor's note: This story has been updated to clarify Accell's plans for Haibike and Ghost.
HEERENVEEN, Netherlands (BRAIN) — Accell Group has sold its Canadian brand registrations for Raleigh, Diamondback, Redline and IZIP to Canadian Tire Corporation for $16 million cash. Canadian Tire is one of that country's largest retail chains.
The move takes some work off the plate of U.S.-based Accell North America, which had been handling sales of the brands to Canadian IBDs. It also gives Canadian Tire four exclusive house bike brands, something that major sports retail chains are increasingly seeking to develop or acquire. Last year, the company acquired the Helly Hansen outdoor brand for $985 million.
Accell North America closed its Canadian office and warehouse in 2018 and began servicing Canadian accounts from its Kent, Washington, offices and a U.S. warehouse, John Short, ANA's CEO, told BRAIN.
ANA used independent sales reps in Canada, where it had 128 dealers with 195 storefronts, Short said. ANA will continue to provide warranty service to those dealers and customers who bought bikes through them, but ANA is terminating sales in Canada.
A representative from Canadian Tire was not immediately available to talk to BRAIN on Friday. Short said Accell and Canadian Tire are interested in collaborating on design, supply chain and other brand support, he said, but there is not a binding agreement to do so.
Besides the Canadian Tire-branded stores, which offer lower end bikes, the Toronto-based company operates several other retail chains, some of them more upscale. For example it owns and operates about 195 SportChek locations, which currently carry bike brands including GT. On earnings calls last year, company officials said a major goal for SportChek was to develop more house brands.
Accell Group owns several other bike brands that have been sold by ANA that were not part of Friday's agreement, however ANA will discontinue all sales into Canada, effective August 12. Accell Group has not decided about possible future sales of its Haibike e-bike brand to dealers and its Ghost brand, which has been sold exclusively to MEC, the Canadian outdoor retail co-op. MEC has been the exclusive Canadian retail outlet for Ghost. In the U.S., REI is Ghost's exclusive retailer. ANA will continue to handle Ghost sales to REI.
Accell Group announced last year that its North American operations were under review following a stream of poor financial results; Accell Group said the agreement with Canadian Tire was part of its strategic review of the operations.
Canadian Tire has 1,700 retail locations and e-commerce business. It is one of the largest bicycle retailers in the country, selling brands including Schwinn, CCM, and its house brand, Supercycle.
The corporation is traded on the Toronto stock exchange under the CTC.A symbol. Its total revenues last year were 14.8 billion CAD ($10.8 billion).
