Hero Cycles acquires Firefox Bikes
18 September 2015
Hero Cycles, the world's largest bicycle manufacturer by volume, said on Wednesday it had acquired India's largest premium bicycle brand Firefox Bikes in an all-cash transaction.
The deal includes Firefox brand of cycles, accessories and spares along with exclusive distribution rights of 'Trek' and other global brands.
However, the acquisition amount was not disclosed.
As part of the deal, both companies have mutually agreed that Firefox Bikes will continue to have its brand identity and remain a separate business entity post the acquisition.
The acquisition will not just aim at consolidating Hero's fledging market share, but is also aimed at expanding the horizons for Firefox Bikes, Hero said in a statement.
The acquisition will see transfer of key technology and rich global experience garnered by Hero Cycles over the last 60 years to Firefox Bikes, which is often credited for creating the premium range in the Indian cycling market, it said in a statement.
Firefox, which has an established presence pan-India through a network of 160 outlets, has been growing at a 3-year CAGR of 35 per cent in revenue.
BMR Advisors and BMR Legal acted as the transaction and legal advisors respectively for Hero Cycles for this deal, consulting firm Deloitte represented Firefox Bikes in the transaction.
''This acquisition is one of the most significant developments in the history of Hero Cycles. We are extremely proud to have Firefox Bikes, which is one of the most recognised brands in the premium cycle segment, as part of the Hero Cycles family,'' said Pankaj Munjal, chairman and MD, Hero Cycles.
''Through this acquisition, Hero Cycles will further expand its presence in all major categories of bicycles in India through its various brands such as Hero Cycles, UT, Firefox and UT Edge. The aim is to provide our customers with world-class products at every price range as per their fast evolving tastes and requirements'' added Munjal.
The premium cycle segment in India has been growing at 25 per cent per annum over the past many years. This segment has today emerged as one of the fastest growing segments in the market by clocking more than 2 lakh units a year.
''This deal will also help Firefox to expand its marketing visibility and acquire an aggressive approach in reaching out to our prospective customers. The acquisition will also translate into uplifting the customer experience at our stores through training of our existing distributor network by Hero Cycles,'' said Shiv Inder Singh, founder and managing director at Firefox Bikes.
As part of the deal, Shiv Inder Singh will continue to head Firefox Bikes post the acquisition as the CEO.
Currently, Firefox sells over 70 different models of Firefox bikes and 25 Trek models through a network of 160 company-owned and franchise outlets. Firefox also has tie-ups with international brands, such as Tern, Shimano, Saris, Finish Line, Kryptonite, Super-B and Slime.