Always bad to hand the company over to a party who’s primary interest is money.

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My Blog

Good in my mind.

One of the signs of a great company is that it matures to the point where it can be sold off and the management can move on to new projects before innovation stagnates. The sales of Zipp and Cervelo are poignant examples. Cervelo hasn't died under PON and the sale freed up the energy and innovation to drive modern gravel bikes forward and bring to market some great products e.g. Open Up, 3T exploro etc. Zipp has also continued at pace since its sale with Silca being one of the product of the shifts at the company. Silca isn't nearly on the same scale as a company like FSA but I would argue they are having a very beneficial impact in terms of breathing new life into other boring and outdate parts of the industry.

I think Canyon has run up against it a bit it terms of its global expansion. The current management way well realize this is party because that is not what they are really good at, but Canyon has matured to the point that it needs to be the next step. The smart money is therefore to sell the company, let someone else handle the logistics of full globalization, and take the cash to start a new project. History would indicate the sale of Canyon won't represent a net loss to bike industry. A change in ownership may mark a steep decline in technologic bike innovation at Canyon but the money will spawn new projects elsewhere. Ultimately even if the new owners drive Canyon into the ground I don't think its a loss. Someone else can rise to take Canyon's place and you will still see benefits from the offshoots that start as a result of the sale.

Or... you can hire someone who knows how to run global expansion.

This is not comparable to Zipp / Cervelo. Those were sold to companies (SRAM / PON) with a vested interest in cycling. The canyon suitors are Carlyle and KKR, this is likely an LBO (leveraged buy out) with value created to shareholders through financial re-engineering (debt expansion), and SG&A reduction. It's probably not an infusion of capital.

EDIT: might not mean much. Looks like Canyon's investor TSG (another PE firm, who also has investment in backcountry, nuun, etc.) is just looking to exit. So, this is just swapping one PE investor for another. https://www.bicycleretailer.com/...es-role#.X5HEbtBKjUR

I think it's a good thing overall. It shows that there's money to be made in the industry and it will drive others to innovate in product lineup, manufacturing, and distribution with consumers being the winners.