Signa Sports United (SSU), which earlier last week confirmed that it had lost a major funding commitment from its parent company, said its subsidiary, Tennis-Point GmbH, had filed for insolvency and the overall company is preparing for insolvency proceedings in the coming days.
SSU, based in Berlin, Germany, operates numerous sports-related websites, including WiggleCRC, Fahrrad.de, Bikester, Probikeshop, Campz, Addnature, and TennisPro. Signa Sports also owns the Vitus and Nukeproof bike brands.
Signa Sports United N.V. said on October 16 that it had lost access to a €150 million ($159 million) equity commitment from its parent company, Signa Holding GmbH. In early October, Signa Sports reported serious liquidity challenges and announced plans to delist its shares from the NYSE.
In a brief statement on October 20, Signs Sports said the termination of the funding commitment by Signa Holding and “the lack of funds to cover the operational financing needs of the Signa Sports United entities” resulted in the insolvency filing of Tennis-Point and its move to pursue insolvency for other entities and the overall company.
LinkedIn posts confirmed that its U.S. offices have been closed.
Hap Seliga, CEO of Bike for North America at Signa Sports, wrote in a post, “Despite exceeding our top and bottom line FY23 goals handily, SIGNA Sports United North America’s bike division has been forced to cease all operations with less than a few days’ notice. This was triggered Monday by a sudden reneging of a binding 150 million Euro equity commitment to SIGNA Sports United N.V. To say this comes as a shock is an understatement. I haven’t even begun to be able to process this yet.”
Luke Dordai, director of bike operations at Signa Sports, wrote on LinkedIn, “I’ve been trying to gather all of my thoughts since the beginning of this week when we first got the news that the 150 million euros that was promised to our parent company by THEIR parent company (confusing, I know) was being withdrawn with immediate effect. While the legality of this is questionable, unfortunately, while that is being sorted out, we have no funding. This meant that we would be forced to cease operations by the end of the day today.”
Matthew Heitmann, chief marketing officer for North America at Signa Sports, wrote in a LinkedIn post, “Exactly one week ago, SIGNA Sports United North America’s future was white hot—our fiscal year results ran counter to nearly every company in the bike space: we exceeded both top line goal and gross profit dollar goal. We assembled America’s top, most authentic talent and built a culture of mutual trust and respectful collaboration. When I say “dream team,” that’s not hyperbole. What our entire crew did in 12 months of operations was simply amazing. We launched Nukeproof and Vitus Bikes and, from day one, had hockey-stick KPIs like I’ve never seen. From a DTC perspective, not only were the brands’ marketing results and metrics off the charts, but our customer economics and metrics would have been the envy of any brand. Add to that a CSAT score of 4.98 out of 5, and we knew we were doing all the right things and building immense value not only for our organization but also for our customers. That meant #loyalty built on the world’s most important currency: #trust. And that was just the beginning of our #vision.”
Heitmann added, “But not everyone values that currency. The unceremonious and abrupt revocation of a binding 150M € equity commitment that partially fueled our start-up operations meant lights out with about 48 hours notice, even for what was one of the shining lights of commercial optimism in SSU’s global portfolio. How far and deep the twisted tentacles of this monster go will likely become more apparent in the coming days and weeks—but I suspect the direct and indirect consequences will be far-reaching, not just for bike and outdoor.”
Photo courtesy Signa Sports
