Online cycling, running and swimming retailer Wiggle has reportedly entered voluntary administration in the wake of the funding crisis that has engulfed parent company, Germany-based Signa Sports United (SSU), after the company that controls it announced earlier this week that it would no longer be providing €150 million in funding to the business over the next two years.
The website Cycling Electric reports that it “has seen a notice from the company to a customer” which outlines that without securing an alternative source of funding to SSU (which was itself depending on the promised but withdrawn funding from controlling shareholder Signa International Sports Holding), Wiggle will “have no choice but to begin administration proceedings.”
Cycling Electric also points out that recent Companies House filings by Wiggle (whose immediate holding company is UK-based Mapil Topco, which also owns Chain Reaction Cycles) highlight that the company relies upon SSU for funding, without which the “group’s ability to continue as a going concern” would be subject to “material uncertainty.”
Earlier, Mike Ashley’s Frasers Group was rumoured to be the most likely candidate to buy Wiggle Chain Reaction Cycles (CRC) should it be put up for sale.
As we reported yesterday, Signa Sports United (SSU), which bought Wiggle CRC in 2021, has had promised funding of €150 million withdrawn by parent company Signa Holding, which is controlled by the Austrian billionaire René Benko.
Days earlier, SSU had delisted its shares from the New York Stock Exchange, two years after they were listed on it, citing “severe liquidity and profitability challenges.”
According to Bloomberg, the withdrawal of funding and scaling back of retail activities comes as Benko seeks to shore up the finances of the commercial property business that underpins his fortune.
On Tuesday, Frasers Group, which owns Sports Direct, House of Fraser and Evans Cycles, among other retail chains, announced that it had agreed to buy the German sporting goods retailer SportScheck, which trades from 34 outlets, from SSU.
“Growing and expanding our sports business is a key focus area in becoming an international retail business.
“The German market represents a huge opportunity for us, and we look forward to bringing our experience, resources and relationships to strengthen the SportScheck business.”
Buying up retail chains and brands that have fallen on hard times, initially in the UK but now abroad too, was a key factor underpinning the growth of Sports Direct and subsequently Fraser Group.
Trade journal Bike Europe believes that Ashley’s company could now also seek to further turn SSU’s problems to its own advantage to bolster its online presence within cycling.
Besides owning Evans Cycles – bought out of administration by Sports Direct in 2018 – earlier this year the group also bought the online retailer ProBikeKit.
> Cycling retailer ProBikeKit to be bought by Mike Ashley’s Frasers Group
Any such deal would afford the opportunity of giving Wiggle CRC’s established in-house brands such as DHB in clothing an established high street presence through Evans’ stores.
And with the two businesses, according to their latest annual reports and accounts, having around half the level of turnover in the UK cycling market as market leader Halfords (a combined figure of approximately £200 million versus perhaps £400 million), any potential deal would be likely to escape being blocked by the Competition & Markets Authority.
Speaking about the SportsScheck acquisition earlier this week, Frasers Group CEO Michael Murray said on Tuesday: “Acquiring the leading sporting goods retailer in Germany is a big step in our journey to becoming the number one sports retailer in EMEA (Europe, Middle East and Africa) – and we are delighted to do this with the full support of major global brand partners, Adidas and Nike.”
We have approached Frasers Group for a comment on the speculation linking them to Wiggle CRC.
26 thoughts on “Wiggle reportedly heading towards administration due to parent company funding woes”
Wen fire sale?
Wen fire sale?
“Black Friday” sale on today
“Black Friday” sale on today
Bad news all round; both the
Bad news all round; both the administration and the fact Mike Ashley might be the buyer.
Wiggle’s predicament isn’t entirely a surprise given they don’t seem to hold much stock anymore (certainly very little that I look at seems to be available).
Read the item yesterday
Read the item yesterday afternoon. Pragmatically placed an order & saw it was dispatched in the evening. I collected it this morning (without paying for next-day delivery). Box contained Harribo. I assume order volume was down from normal. Not sure I risk an order now.
They had £79 million in stock
They had £79 million in stock on the last filed accounts but that included hotlines and wiggle as well as chain reaction.
Benko’s empire is falling
Benko’s empire is falling apart (not because his real estate properties are not well built). Over 1 billiion usd lost just for unreal value of the assets….the main shopping galleries sold already to other investors…German and Austrian IRSs are investigating his companies…developing projects in northen italy slowing down…For the first time on its history the European Central Bank is investigating if the money given to Benko from european banks (European money) was supported by serious/solid warranties…it looks like somebody wants back their money before the bubble explodes…and leaving the NYSE was just the beginning…Americans didn’t even try to keep him in…
At the end having Britons taking over everything on the bike/sport retail side is really good news…
This is because of the Haribo
This is because of the Haribo, isn’t it.
We seem to be drifting
We seem to be drifting towards a world where we have all the expensive luxe stuff and everything else is owned by Sports Direct…
A friend of mine has very
A friend of mine has very recently returned a bike to wiggle due to crack in frame. He is now very concerned and not getting any response from them. I would imagine there are a few people in this situation. I appreciate it’s probably pretty chaotic at wiggle at the moment but would it be possible please to try and find out what is the plan for this kind of thing? Many thx.
Depending on how your friend
Depending on how your friend paid for the bike. I would take all the pictures of the cracked frame, invoices and printouts of all communications between the customer and Wiggle to the bank and inform them of the matter.
The bank will likely initiate a chargeback depending on how long wiggle have taken to respond and since the business its going to the dogs its highly likely that a chargeback would be the only option of getting the money back.
Thx for your reply. Will pass
Thx for your reply. Will pass that on. Is it realistic to think that if they get bought out then the new owner will somehow need to process warranty claims or return bikes which are being processed?
By law. So long as wiggle is
By law. So long as wiggle is operating (regardless of who owns them) warranty should be honored if you are within the warranty period. If they dont then it would leave the door open for them to get taken to court. Be it a small claims court or class action lawsuit.
I’m not convinced this is
I’m not convinced this is always true. It might be true if there is a “rescue deal” in which the company itself continues to operate under new ownership.
However, often only the brand/IP rights are bought, in which case the company subsequently operating as “Wiggle” would be legally an entirely separate entity, with no obligations to customers of the previous company, despite trading under the same brand name.
What will happen to their own
What will happen to their own brands (DHB and Prime) – they’re probably the best things about Wiggle (in fact, I think I’ve only used them for their own brand stuff for some time now – I go elsewhere for anything else)?
And Vitus bicycles. Probably
And Vitus bicycles. Probably they will be sold off. Whether as going concerns, retaining some of the staff that made their stuff good, or as brands to be slapped on someone else’s products, is another matter. Vitus already went through the latter process, but it’s bicycles have been getting pretty good lately.
ubercurmudgeon wrote:
There’s a Vitus e-bike in the shed – a very good tourer, graveller and winter bike with the removable Fazua motor/battery so an empty thing (or one filled with cake) can be put in the bike instead of the motor/battery to make it an ordinary (not an Ordinary) bicycle.
So am I bovvered if Wiggle goes phut, along with the supply of Vitus bits? Slightly, although it’s only really the gear hanger that might be a Vitus-only part (I’ve got a spare) with everything else but the frame the commonly-found stuff from Shimano et al. Standard fittings everywhere on it apart from the motor/gearbox.
Looking back on all the bikes I’ve owned, I’ve never taken any of them back to the seller for a fix. Bikes aren’t really like cars, needing all sorts of dedicated brand-specific tooling and knowledge to keep going. It is slowly changing, mind, with peculiar shaped seat posts and stems or other parts that are far from standard. I’ll be doing my best never to buy such a bicycle.
However, e-bikes in general seem rather vulnerable to going down the maintence path of cars. If Fazua were to disappear for example (Porsche, who own it now, might drop Fazua systems in favour of a new! improved! Porsche motor) my Vitus e-bike might prove difficult to keep e …. although the design at least means I can continue using it as a perfectly fine unpowered bike. Well …. apart from if the BB gearbox goes ….. . Fazua say its tested for a 250,000 km life, though. I can hope.
It’s likely to follow the
It’s likely to follow the Sports Direct model of ‘own-brands’ where the retailer sells lots of products apparently from lots of different brands. However, when you look a bit deeper you find that all these brands are owned by Sports Direct and the quality is uniformly terrible
henryb wrote:
I think they’re referred to as zombie brands. SD simply bought the brand name.
If brands like dhb are the
If brands like dhb are the strongest part, surely a new buyer would want to keep those going, one way or another?
They’ve not stopped sending
They’ve not stopped sending marketing emails – just got one at 8.32 this morning.
And from Wiggle half an hour
And from Wiggle half an hour later!
enjoy the last bike rides,
enjoy the last bike rides, the world is ending… you will no longer find tires and chains, batteries and water bottles… but petrol and weapons will never run out…c’mon…be positive…you are bike riders…there is always a solution… 🙂
Cyclists! Survive the
Cyclists! Survive the apocalypse in comfort by mounting a chainsaw to the front of your ride!
Knights of the road!
Knights of the road!
Very mixed feelings about
Very mixed feelings about this. Like others, I have spend thousands of pounds with Wiggle (much to the annoyance of my wife!). I don’t want to see any good people lose their jobs. But I have to say that the business direction of Wiggle / CRC this year has been downright awful.
When I say I have spent thousands of pounds, if you asked me I wouldn’t be able to tell you what I spent all that money on because they wiped out my entire history of buying from them and just to make sure- they brought in the worst website I’ve ever seen to really rub it in.
I ignored the obvious profiteering in the few years before we left the EU when they hiked the prices on everything that had already been in stock for years and blamed it on importation costs.
I ignored the stock shortages & price rises during Covid and patiently waited for stock to arrive ( sometimes in pairs like the animals in Noah’s Ark ) and losing out when I didn’t click order fast enough on the stock alert.
I miss CRC being a separate company that had the better customer service experience than Wiggle and if one had no stock you could go to the other.
Be interesting if the company does fold, as to whether it leads to an overdue return to the local bike shop- but I won’t hold my breath, as where there’s a vacuum someone fills it!
My wife and I have 3 bikes we
My wife and I have 3 bikes we bought 10/15 years ago. They’re still awesome. My Rapha kit from that time is only just wearing out in places.
That’s the problem with bike kit selling. Everyone’s already got one.
the little stuff: whatevs, Amazon rules the world. Retailing is a nightmare.