I’m getting back into riding after quite a few years off. The e-bike deals are really tempting, but assume there is basically no warranty now on vitus/nukeproof frames? Might have more luck on component warranties such as Shimano (thinking of the steps motor).
Anyone got and info regarding this?
So it looks like he paid under £10 million
Presumably losing all dept in the process
https://road.cc/content/news/mike-ashleys-frasers-group-buys-wiggle-ps10m-307081
@convert - our Evri deliveries are just as good/regular as Amazon, PO etc. Tracking is accurate and everything arrives on time.
Presumably losing all dept in the process
That's how these things work - if dept was transferred to a new owner they'd be in no better place than the previous owner.
It's shit, but that's how it is.
And I've been on the receiving end of this when companies have gone bust on me.
Mike Ashley’s Frasers Group has acquired Wiggle Chain Reaction Cycles’ brand and intellectual property
Debt doesn't come into it. He's just bought the name and IP - presumably to slap on his existing online cycling offer.
He's not bought the business as a going concern. It's not like a pre-pack deal where the business gets phoenix-ed and trading continues via a very similar entity.
So it looks like he paid under £10 million
Presumably losing all dept in the process
As above, he's just bought the names/logos * of the shop (and house brands). He's not bought the company, the real estate, the stock, the staff etc.
I've no love for the guy but if you're going to be facetious he's paid £10million to the creditors they wouldn't have got otherwise.
The point of going into administration when you're insolvent and unable to continue trading is so that suppliers etc can try and get their money back. There are examples of companies abusing the system to avoid liabilities, but in this case it seems a fairly straightforward case of the business model just didn't work, so there was no "business" worth selling (phenix like or otherwise).
The company's total unsecured debts were only £26.7 million, so between that £10million and the stock clearance it'll be interesting to see how much/little is actually lost. Most of the "debt" seems to have been moved into the holding company which folded but I presume that debt was owned by investors not suppliers.
*it's not really clear if he's bought the rest of the IP like designs, websites etc?
The interesting thing to me is that £10m is potentially a bit of a bargain if it gives Fraser group a better internet cycling storefront that Evans plus a few more brand names slap on their tat...
As also reported in February, the deal will result in all 447 of WiggleCRC’s employees losing their jobs, with a number taking to social media last week to confirm that their “time was up” at the company as the administrators “closed the shutters”....
...The deal also follows the trend for Frasers to purchase the brand and intellectual property of retailers on the brink of collapse at a heavy discount, while laying off all or almost all of the company’s staff in the process.
^^These statements from the road.cc article^^ feel like the reporting is intended to direct some extra anger/blame at Ashley, instead of Signa who were basically the ones that ****ed the Chiggle employees. He's just buying some of the remaining assets (same as the rest of us picking up heavily discounted kit/parts/bikes). Ashley is no 'business angel' and his growing involvement in the cycling retail world isn't necessarily something to welcome, but it does seem like some of the reporting is a bit disingenuous (IMO).
Wonder if that £10m includes the design specs and supplier data for all the inhouse brand Nukeproof / Vitus / Prime frames and parts and Lifeline / DHB /Fohn clothing?
is intended to direct some extra anger/blame at Ashley, instead of Signa who were basically the ones that **** the Chiggle employees. He’s just buying some of the remaining assets (same as the rest of us picking up heavily discounted kit/parts/bikes).
A very good point. You've made me reconsider how I see this anyway.
Im surprised they got £10m to be honest, seems a lot for what looks like mostly IP and very little stock/assets.
Wonder if that £10m includes the design specs and supplier data for all the inhouse brand Nukeproof / Vitus / Prime frames and parts and Lifeline / DHB /Fohn clothing?
Also curious about this.
They could get a few more years out of those designs (longer for clothing) without having to employ a design team.
What have they done with Evans' in-house stuff? Might give a clue.
I agree with that - I would have thought that if nobody else took CRC / Wiggle a £10mill investment in a newly branded online store would be a better way to spend money. £10mil buys a lot of google ads / web development / logo designs etc.
It will be interesting to see exactly what happens here with the in-house brands, maybe a calculation has been made that they can re-sell those brands or that much of the value lies here.
Wonder if that £10m includes the design specs and supplier data for all the inhouse brand Nukeproof / Vitus / Prime frames and parts and Lifeline / DHB /Fohn clothing?
If it does, it's a bit of a bargain, but I suspect there's a limit to what sort of manufacturing Fraser group will actually want to undertake in a rather Recessive cycling market.
If they own the rights to designs rather than just logos I'd expect them to maybe pick up the 'soft goods' side of things.
Im surprised they got £10m to be honest, seems a lot for what looks like mostly IP and very little stock/assets.
Surely the stock comes with Debts attached, and is now significantly devalued by the recent fire sales.
I wouldn't undervalue IP (although it's still unclear what 'IP' actually covers in this instance) the Wiggle and CRC web addresses alone should generate plenty of sales traffic (thus they are assets in their own right), not everyone will be as aware as us bike nerds about these industry shenanigans and will follow the top hits from google or bang in the same URL they always have to buy some bike stuff...
Some of the brands have some solid value, I still see plenty of DHB kit out and about when riding, it ain't Castelli or Rapha but DHB is pretty widely purchased and used, carrying over their VFM proposition could well suit Fraser group.
NP/Ragley/Vitus Dunno, Is Vitus really worth much more than Pinnacle? Will Fraser group want to pick up manufacture of more 'premium' pitched brands like NP or Ragley? or start knocking out Carbon wheels under the prime brand again?
Given they're already picking over the bones of a recessive online cycling retail market Probably not in the first year or two.
If they make 3x their £10m back on the deal within ~24 months (they probably will), they might consider trying their hand at more adventurous stuff but it's all a Risk Vs Reward calculation.
The other thing they might consider is parting out some of that IP to sell on, This certainly isn't the first incarnation of NukeProof, and I'm sure someone thinks they'd be able to revive Ragley as a brand post Chiggle...
£10m is a pretty good price IMO.
I want bemoaning the buying without debt. I was more thinking that if he gets the designs too it’s not a huge amount of money.
I’m assuming that at some point when i Google mountain bike I’ll see a bike called a Nukeproof on a website called wiggle. That bike will have no further design or marketing costs over what has just been paid.
Will Fraser group want to pick up manufacture of more ‘premium’ pitched brands like NP or Ragley?
See I was thinking the opposite. Presumably if they want Nukeproof bikes all they have do is email the manufacturer with numbers in each size….
See I was thinking the opposite. Presumably if they want Nukeproof bikes all they have do is email the manufacturer with numbers in each size….
And then pay, probably up front given the last couple of years.
Plus weren't Chiggle assembling NP frames and components together here in the UK?
Fraser group (Evans) are probably more used to Pinnacles turning as complete boxed bikes from the far east, only requiring a 'turn the bars, fit pedals' type PDI, not doing full builds or sourcing finishing kit, that's all cost I doubt they'd want to swallow and logistics they're not currently setup for, especially given how it all turned out for the company they've just bought a brand name from.
£10m seems a lot to me. They paid £8m for all of Evans in a more bouyant (or at least more certain) market.
Edit: Just read the article though. It says 'worth less than £10 million,' which is not £10m. So what is it?
That’s an interesting comparison. Evans were in administration but he took on the stores. So I guess he took on more liability than with the chiggle deal
See I was thinking the opposite. Presumably if they want Nukeproof bikes all they have do is email the manufacturer with numbers in each size….
Old Nukeproof should own the moulds, with exclusive use of the frame designs. If (as above) the frame manufacturer is owed money then I'm sure there will be some interesting and frank discussions about getting access to them (which at best means Ashley having to buy the moulds from the Administrator).
It looks like a great big mess.
He won't though, it'll just be catalogue bikes.
Still no order despatch confirmation, supposed to arrive Wednesday. Whatever, I can live without the stuff but it would have been handy.
The very cheap Brand X dropper post I ordered on Thursday arrived this morning. All good, but no sweeties in the box. Things really must be bad.
Got the dispatch note soon after I posted.
They owe Haribo £20k, I wouldn't imagine there will be any freebies.
I think the "under" in under £10m must be doing some heavy lifting - the IP is worth a very small percentage of that without the team and infrastucture around it.
That's it then - websites are now closed.
Placed an order a couple of days ago so hopefully that'll be delivered.
Who is left to build jumps and switchbacks, I wonder...
Edit: Looking at the wording, I can't help but think there was no one left to even write the text for the holding page and so someone just asked ChatGPT to come up with something.
Who is left to build jumps and switchbacks, I wonder…
Edit: Looking at the wording, I can’t help but think there was no one left to even write the text for the holding page and so someone just asked ChatGPT to come up with something.
It's just the holding page from when they changed the website design/infrastructure last year, with a couple of sentences of spiel added at the bottom re. current orders.
Just reading through the list of creditors. There is no way the demise of Wiggle is not going to have a domino effect for the bike industry. So many of these companies won't be able to sustain the scale of loss. 🙁
Interesting that 'software' is valued at £1m. Cant be the website??
Some of the numbers blow my little mind.
Yep, lots or 6 figure sums owed and quite a few over a million, I'm sure Google can afford it but there will be plenty of companies on that list that it'll hit hard. Singletrack owed about £1200
Endura owed quite a bit. That will sting! Can companies take out insurance against this sort of thing?
Quite a few with big numbers - Madison, Hope & Endura...
Also the Race Team are owed too - Sam Hill £34k, Kelan Grant, Eliot Heap, Dan Booker, Corey Watson, Joe Smith & Jacy Shumalik.......
Oh and still owe Haribo £24k.....
Some riders/film makers on that list aswell. Sam Hill is owed £35k!
EDIT - Should have refreshed before I posted!
I can sort of see how the bike industry supply chain has ended up like this, where Chiggle are the bigger entity in the deal but there are some odd ones in there. Oracle are owed £445k, how have they not pulled the plug on whatever their contract was for before it got that bad!
Some of the distributors are stuck with silly amounts owing to them aren't they.
Why would you let them build that sort of debt, Saddleback over £800k, Garmin also! What were their credit control and risk teams doing?
They didn't even settle up with the bloody Milk Delivery Person...
What were their credit control and risk teams doing?
Depends entirely on whether or not WCRC's credit with those suppliers was insured.
There are some very big numbers on that list which will be insured and therefore survivable, and some smaller numbers that were not and could end up sinking the business they were owed to.
The numbers themselves are not the whole story.
That list is 6 months old though - It remains to be seen how much of this debt has been paid and to who, I imagine some suppliers collected stock unpaid too.
I imagine a larger guys giving out credit are insured if they do lose big, maybe not though - I agree that there will be a knock-on effect from this though, especially as I can imagine bike companies aren't flush for cash right now.
“Endura owed quite a bit”
We were talking about this last week. Endura (and others) must be fuming, they havent been paid, and then,to rub it in even more, their stock is being sold at cost price, so nowhere else in the Country is having any Endura sales, as CRC are so cheap, hence they are not selling any other stuff to anyone else. There is a need for a Contract where it stays your property until the Bill is paid in full. Such Contracts are common in the building industry, if the buyer goes bust, you go to the site to collect your goods back.
I see they owe(d) Hermes/Evri more than 140 grand. Which could explain why they don't seem to be in a hurry to deliver my final order...
Also, 20 grand in Haribo not paid for. Sounds like it wasn't just us getting free sweets.
Some distributors were still supplying until fairly recently, so I'm guessing debts must have been cleared to a reasonable level.
The bigger fallout will be if Nukeproof disappears. All those bike shops who sold them, would then be liable for the warranty, and I'd guess very few of those shops would be able to absorb the cost of refunding/compensating customers for many failures.
And there are many failures.
house of frazer are selling trek.
There is a need for a Contract where it stays your property until the Bill is paid in full.
Frankly I'd be amazed if there wasn't such a clause. When I had a shop all suppliers had a "goods remain the property of XXX until paid for in full". How enforceable it is, OTOH...
any warranties are worthless. Nothing to do with the retailer (beyond statutory rights).
This is just playing with terminology.
While yes a "warranty" is with the manufacturer, there's a hell of a lot of protection afforded by the consumer rights act that the shops will still be on the hook for, and can't hide behind the "it's a warranty so you need to take it up with the manufacturer" excuse.
It really isn’t. After 6 months the onus would be on the buyer to prove a manufacturing defect in the event of e.g. a snapped frame. Good luck with that. Massively different compared to the 5-year warranty offered by NP.
not the case at all. If Nukeproof go (and they have gone, surely?) any warranties are worthless. Nothing to do with the retailer (beyond statutory rights).
As a consumer, your contract is with the retailer. You legally have no contract with the manufacturer. Yes, manufacturer's will often deal with a customer directly, but they have no legal requirement to do so. If your retailer disappears, legally the manufacturer could simply tell you it's not their problem, but doing so would be a PR disaster.
If you buy a product with a 5 year warranty, then a retailer can't suddenly say only your statutory rights apply, just because the manufacturer no longer exists.
that is exactly what will happen. The warranty is nothing to do with the bike shop. If you’re buying a telly from John Lewis then it’s different as they provide the warranty themselves.If you buy a product with a 5 year warranty, then a retailer can’t suddenly say only your statutory rights apply, just because the manufacturer no longer exists.
I suspect a lot of product was already returned to manufacturers where possible, all the DMR stuff was wiped after the liquidation announcement and I bet others were similar.
"If you buy a product with a 5 year warranty, then a retailer can’t suddenly say only your statutory rights apply, just because the manufacturer no longer exists."
Of course they can in exactly the same way they can refuse to warranty a Specialized they sold if they were no longer part of their dealer network. Warranties are provided by manufacturers, how you go about claiming depends on their distribution model but ultimately it lies with them. No manufacturer, no warranty. You could try making a class action claim but you won't get far if there is no legal entity to take to court.
“Endura owed quite a bit”
We were talking about this last week. Endura (and others) must be fuming, they havent been paid, and then,to rub it in even more, their stock is being sold at cost price, so nowhere else in the Country is having any Endura sales, as CRC are so cheap, hence they are not selling any other stuff to anyone else.
This is only the tip of the iceberg......as well as nobody else selling Endura (as an example) at the moment the public will have been loading up with seasons worth of spare kit at these prices. So Endura will be looking at years worth of reduced sales. It's likely that they are overstocked at the moment (as are most of the other companies on the debtors list) and they may even still have incoming stock from forecasts that CRC would have been taking it. Oh, and they've probably lost their single biggest customer/route to market as well...... You can copy/paste most of the bike trade brands/distributors that were dealing with CRC into that scenario and we wont see the true impact until after the spring of next year as they will be moving a lot less product through this summer/autumn. They rely on those summer sales to float through the winter....
