Sky News has reported that 10 days since appointing advisers, Evans Cycles is trying to find a buyer. Advisers to the company have asked interested parties to submit final takeover proposals “by the end of next week”. A number of private equity companies, retailers and turnaround investors have been asked to consider making offers for Evans, according to those close to the process.
The current situation was summed up as follows “It was unclear on Thursday whether a buyer would examine an insolvency mechanism called a Company Voluntary Arrangement (CVA) in an effort to close Evans’ worst-performing stores. The company, which is owned by the private equity firm ECI Partners, is being advised by PricewaterhouseCoopers (PwC), while AlixPartners is understood to be advising AIB and HSBC, the retailer’s principal lenders. It has been backed by a number of investment firms, including Active Private Equity, which sold it to ECi in 2015 for an undisclosed sum. ECI is not expected to be part of any rescue deal.”
Chains such as House of Fraser, Mothercare, New Look and Toys R Us UK and Orla Kiely have also run into difficulty on the High St.
While in the cycle trade it appears the “end-of-season-cash-flow-crunch” bringing things to a head is a familiar theme. This time last year wiggleCRC reported losses and Cycle Surgery closed a number of branches. The malaise doesn’t seem to be limited to large store chains, with many long established independent stores also closing in 2018.
The Telegraph goes further in this article linking the woes of direct to consumer brand Rapha and the closure/sale of Factory Media pointing out that: “nearly all the market players have ridden on the coat-tails of a new breed of cyclist that has emerged in the last decade: the mamil, or middle-aged man in Lycra.”
It concludes that brighter times may be ahead with e-bikes becoming a mainstream method of low emission commuting and that overall “The market place is hugely competitive and a number of brands have folded or are searching for profitability. The market is finally having a sort out, however I don’t think this implies the British cycling industry is peaking.”