By Eric Smith

The origin of Hayes Performance Systems’ acquisition of carbon wheel maker Reynolds Cycling LLC, which closed on Tuesday and was announced Wednesday, dates back to early 2018 when Darren Campbell and Scott Montgomery began casual discussions about why uniting their companies made sense.

The two bike industry veterans—Campbell is president of Mequon, WI-based Hayes Bicycle Group and Montgomery is CEO of Sandy, UT-based Reynolds Cycling—had known each other for years from interactions at various trade shows and industry events, but a January conversation sparked the idea that Reynolds would be a good fit in Hayes’ portfolio.

The Hayes “family” of bicycle brands included Hayes Disc Brake, Manitou, SUNringle, ProTaper and Wheelsmith, but the addition of Reynolds and its premium, carbon wheel product line would fill a gap and provide Hayes a stronger position in the market. It would also allow Reynolds to scale up its own product line.

“When Scott and I first started talking about this, the list of potential opportunities and things that we are complementary on got really long really quick,” Campbell told SGB. “That made us both pretty excited about it. We don’t have a carbon wheel offering within Hayes Bicycle Group at the moment, and when you look at the industry, the continuing trend of carbon wheels being more and more prominent on bicycles, that was a problem for us.”

Click here to read the news release about the acquisition.

Before long, exploratory conversations around why Reynolds would be a good asset for Hayes grew more serious, and by summer, the companies started hammering out a purchase agreement. As the companies moved closer to inking a deal and completing due diligence, the acquisition began to make even more sense.

“We have an alloy wheel line, but it’s tough to be competitive across the board—certainly with higher-end bikes—just with alloys,” Campbell said. “It fills a pretty massive void for us, and in addition to that, our current brands are primarily mountain bike brands, so bringing Reynolds in really helps open us up to a lot of the road, tri and gravel applications that we were really targeting before. It’s a good growth opportunity for us, and we hope we can bring some of the growth opportunity to Reynolds as well.”

For Montgomery, who was appointed as CEO of the Reynolds in 2017, joining forces with Hayes made so much sense that Montgomery is sure the deal would’ve occurred at some point down the road, but the fall timing proved ideal.

“I think it would’ve happened eventually, but the fact that the two companies fit together pretty well, we moved things up,” Montgomery said.

Selling to Hayes made sense for a variety of reasons, Montgomery said, not only because of his company’s carbon wheel offering, but because the companies’ manufacturing and distribution footprints complement each other.

“We both have a presence in Asia, though I think Hayes has a stronger presence with more employees,” Montgomery said. “But our factories are only a couple of hours apart in China. We all have strong engineering backgrounds. Increasingly, the OEM business is really driving the positioning of the brands. It definitely helps to be able to go to brands with more product. On the wheel side, we can go top to bottom on price from aluminum to the high-end carbon.”

Additionally, there was a cultural alignment between Hayes and Reynolds, a growing consideration in M&A deals no matter the industry. For these two bicycle industry stalwarts, it started with the fact that at both companies “half of the staff owns bikes that are more expensive than their cars,” Campbell said with a laugh.

But more than that, Campbell added, “at Hayes, we are truly looking for superior products to win all battles. When you look at the Reynolds product offering, you can put them up against any of their competitors and find a good, compelling story in there. Their product line is technical, high-performance, and it provides a lot of value for the customers. In general, that fits with the Hayes brand and all our products.”

Terms of the deal weren’t disclosed, but Campbell and Montgomery outlined for SGB some of the acquisition’s specifics. For example, Hayes has 400-plus workers, and Reynolds has around 130, and while there may be some redundancies to be examined later, the companies said no immediate changes will be made in employee count.

Montgomery will retain his title as CEO of Reynolds, and the company will remain based in Utah, although there are long-term plans to increase Reynolds’ presence in Wisconsin as the brand grows under the Hayes umbrella.

And the companies’ manufacturing facilities will retain their current production duties, primarily because of the molding capabilities at each, though scaling up production is likely as integration progresses.

Both companies are privately held and declined to disclose revenue or production levels, but according to Montgomery, “we anticipate double-digit growth for the combined entity next year, and we think this gives us a substantially stronger position in the cycling market for wheels.”

There are also no immediate plans to alter the Reynolds brand or logo aside from aligning it with some of Hayes’ branding guidelines.

“One of the things that we’ve learned as we added more brands to the portfolio is, you discover the history and culture that goes along with one of those brands, and you start to uncover across the globe the brand loyalists that have been using the products and following the brand since they were young,” Campbell said. “For us to try to assume that one of these brands is better than the other and we’re going to try to change its name or its look is foolish. We want to make sure we keep it current and relevant, but certainly they’re going to keep their identities.”

Now that the deal’s integration is commencing, the companies are focused on keeping those sometimes-messy processes behind the scenes and seamless for customers, which will mean over-communicating with customers on every facet of the ordering and fulfillment timeline.

The companies will make their public debut as unified entities at a trade show in Taiwan next month and will make their North American debut at CABDA in February. Before, during and after those shows, Campbell and Montgomery said the focus is on making Reynolds feel at home in the Hayes family and growing business across the portfolio.

“Our product line has never been better,” Montgomery said. “With their added engineering expertise and some global capacity with distribution and offices, it will put us in a really strong place to be competitive for all the channels, whether it’s brick-and-mortar shops, distributors or OEMs.”

Photo courtesy Reynolds Cycling LLC

Author’s note: “Behind The Deal” is an occasional series that takes a deep dive on M&A transactions in the active lifestyle space. Email me at to have your deal featured.

[author] [author_image timthumb=’on’][/author_image] [author_info]Eric Smith is Senior Business Editor at SGB Media. Reach him at or 303-578-7008. Follow on Twitter or connect on LinkedIn.[/author_info] [/author]