There’s light at the end of the bankruptcy tunnel for Cannondale following the successful auction of its bicycle and motorsports divisions.
As was forecast back in January, it was Cannondale’s main creditor, Pegasus, who came up with the winning bid in the end. The terms of the bid haven’t been disclosed, but what is clear is that Pegasus intend to work with the current management to develop the bicycle business and won’t be continuing the motorsports division.
Provided that the courts approve the sale to Pegasus (and there seems no reason why they shouldn’t), Cannondale are confident that they can settle back into full swing after coming out of Chapter 11 relatively quickly. Cannondale founder, Joe Montgomery commented, “This is a huge step toward successfully realizing our three key objectives: ensuring a quick emergence from chapter 11, restoring focus and adding resources to the bike division so it can continue to thrive and prosper, and preserving our employees’ jobs in Connecticut and Pennsylvania.”
Earlier this month workers returned to the Company’s Bedford, Pennsylvania bike factory to resume bike production, after a temporary (but longer than usual) lay-off over the winter.
Pegasus’ David Uri explained the reasoning behind their move to bail out Cannondale saying, “The fact that the bike division has remained profitable despite the distraction and costs of its now closed motorsports business clearly demonstrates the strength of the brand. Our job now is to let Cannondale concentrate on what Cannondale does best – designing, manufacturing and marketing lightweight, high-performance bicycles for the specialty retail market.”
So it’s very much the end of Cannondale’s motorsports adventures, and business as usual for the bicycle division. It’s good news – opinion may be split over Cannondale’s products but there’s no denying that the world of bikes would be a poorer place without them.