Halfords Group plc, one of the United Kingdom’s largest bicycle and car camping retailers, has acquired Tredz Limited and Wheelies Direct Limited, which specialize in online sale of premium bikes and accessories.
The acquired businesses comprise an online retailer of premium bikes and cycling parts, accessories and clothing, which trades UK-wide under the brand Tredz, and the UK’s largest provider of bicycle replacement for insurance companies which trades under the brand Wheelies.
Collectively the businesses generated revenue of about £32 m for the year ended Feb. 29, 2016, up from about £24 m in the prior year, and EBITDA of £2.4 m. Halfords has paid £18.4 m in cash from its existing borrowing facilities and will pay addition sums depending on Tredz profits in the year ending Feb. 28, 2017. The total purchase price is expected to equate to an EBITDA multiple of around seven times and Tredz is expected to contributed earnings in its first year of ownership.
Halfords acquired Tredz and Wheelies from founders Keith and Michael Jones. From a customer and supplier perspective the businesses will continue to trade on a standalone basis and will continue to be led by Keith Jones and the existing management teams.
“We are delighted with this acquisition, which we believe is a strong and complementary addition to the Group, extending our presence in the online market for premium bikes, parts, accessories and clothing,” said Halfords CEO Jill McDonald. “We continue to believe in the long-term growth potential of the cycling market. Keith and his management team have done a fantastic job of building a successful online retail operation and we look forward to working with them to develop and grow the businesses further.”
Tredz and Wheelies grew from a small shop 27 years ago into a strong operator in the premium cycling market, with a team of over 250 people.
“However, the time has come for us to work with a partner on the next phase of growth,” said Keith Jones, Group Managing Director. “Halfords is exactly what we were looking for. With the support and resources of a large group, we look forward to building upon what we have achieved so far to drive long-term growth.”
