Mike Ashley’s Frasers Group bought out the administration of online bicycle retailer Wiggle as the retail giant continued to capitalize on the distress coursing throughout the industry.
Frasers, owner of Sports Direct has reached an agreement to buy the intellectual property and brand of Wiggle as well as Chain Reaction Cycles.
Wiggle is a new addition to Frasers existing cycling business which already includes Evans Cycles.
Frasers is now headed by Michael Murray, Ashley’s son-in law, and it is believed that the company paid less than PS10million for Wiggle’s brand and intellectual properties.
The deal is made as the cycling industry is in turmoil. Global supply chain crisis left industry struggling to meet the demand that grew during pandemic. After the supply bottlenecks eased, consumer demand dropped and retailers had excess stock that they were forced discount. This problem has been exacerbated by inflation and a lowered consumer confidence.
In October , Wiggle went bankrupt . It owed 155 million pounds sterling. The deal with Frasers is expected to result in the loss of 447 jobs.
Frasers, a sports company in the UK, is believed to be interested in Wiggle because of its strong online and social media presence. It believes that Wiggle can help it to take its business to a higher market. The company declined comment.
Halfords had to warn investors last week that the pre-tax profit would be about 25 percent below expectations. This was partly due to the weak demand for cycling gear. The company also claimed that the market distress had led to widespread discounts.