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SE Parent Acquired by Head Sport Parent

January 21, 2019 by  

Head Sport parent Buys ASE
**Updated February 2, 2019**
Following events in US Bankruptcy court on Friday, Feb 1, the details reported in the story below have now been superseded by a new buyer (“Tiger Group”), and a new bid ($23 Million). Head Sport is out of the picture, as of this writing, after terms surrounding its previous winning bid, reported below, could not be fully agreed-to by the court.

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Advanced Sport Enterprises, parent to BMX brand SE Bikes, as well as other marquee brands in the cycling industry, such as Fuji and Kestral, filed for Chapter 11 Bankruptcy protection on November 16.

The company was heavily invested in retail, via its Performance Bicycle shops, which operated in 19 states, with over 100 locations. The retail bicycle business is definitely not what it used to be– and that, coupled with being admittedly undercapitalized, led to the circumstances that precipitated the filing.

Last week, an auction was held in order to sell off key assets of ASE, which reported liabilities of over $100 million in their Chapter 11 petition. Representatives from several companies were on hand, including manufacturer Ideal Bike Co (the factory that makes many of ASE’s products, and among its largest creditors), Dicks Sporting Goods and Walmart.

Earlier in the week, there was the pre-auction sale of the “Roubaix” bicycles trademark to Specialized Bicycles for $700,000. Specialized had been licensing the Roubaix name from ASE since 2003, and there was fear that if the trademark had gone to auction, a successful bidder may not agree to re-license the mark to Specialized.

The auction lasted 16 hours, running til well-after Midnight. When the final bids were gaveled, HTM Holdings USA, LLC won the bid, for $21.5 Million. HTM is owned by the same group as Head Sport, and controlled by Swedish-born Billionaire, Johan Eliasch, who serves as CEO of Head Sport.

Head Sport’s products are popular in the Tennis and Ski worlds, and they license their name to appear on a wide variety of products in other market sectors, including bicycles.

The bid still requires approval from the US Bankruptcy Court to become official. That approval is expected to be handed down tomorrow (January 22).

Early comments from bicycle industry sources are positive to the acquisition. Dealers seem to have faith that Head’s longstanding experience with independent resellers (the chief outlet for their ski and tennis products), will position them well to properly serve independent bike dealers who rely on Fuji, Kestral, SE and other brands formerly in the ASE portfolio.

For their part, SE expects “business as usual” in terms of their operations, and an even brighter future, with the leadership (and pocketbook) of Mr. Eliasch.

SE Bikes customers will see some good times ahead, too, as thousands of units will be released from the factory very soon after the deal is approved by the court. These bikes were built in the days and weeks leading up to ASE’s Chapter 11 filing, and have been in a holding pattern until the case was resolved.

And yes, we’ll assume all concerned have heard most of the “head” jokes by now.

—Mike Carruth

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