Fri, 12 Feb 2016 | BUSINESS SALE
Wiggle, the largest online retailer of bikes and cycling equipment, is in the final stages of a takeover bid for its closest rival, Chain Reaction Cycles.
The two companies have been engaged in a battle for online sales for years. However, the move is significant for the bike shop industry, as the proposed merger of the two biggest online outfits would undoubtedly mean that bricks and mortar stores would have trouble competing against ever-lower online prices.
Speaking to The Times, Michael Oliver, senior leisure and media analyst at Mintel, said: “It is hard to see the business case, other than to take a competitor out of the marketplace.
“I think the independent bike trade will be quite worried about this.”
Wiggle started out in Portsmouth as Butler Cycles, changing its name to Wiggle Cycles in 1999. The business moved online exclusively and saw sales increase significantly. In 2011 the company was bought by Bridgeport Capital for £180 million.
Wiggle’s turnover reached £179.2 million in 2015 and the company has trebled the size of its distribution centre since moving to Wolverhampton.
Chain Reaction Cycles began as a family-run bike shop, based in Doagh, County Antrim, in 1985. The founders, George and Janice Watson, moved the business online in 1999.
Turnover at Chain Reaction Cycles hit £153.2 million last year. The company currently employs more than 600 people, according to The Times.
A spokesman for Chain Reaction Cycles told the BBC that the takeover is “speculation at this point”.
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