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Mike Ashley's Sports Direct in market for £100m Evans Cycles sale?

Newcastle United FC owner's business said to be among those interested in buying chain as investors seek exit...

Newcastle United and Sports Direct owner Mike Ashley is reported to be among potential purchasers of the UK’s largest specialist bicycle retail chain, Evans Cycles.

Last month, it was reported that Active Capital, the private equity firm that bought the retailer in 2008 in a deal worth £35 million, was exploring a potential sale of the business.

According to Telegraph.co.uk, online retailer Wiggle, also under private equity ownership, is interested in acquiring Evans too, as are other investment firms.

But the newspaper says that Halfords, which sells more bicycles than anyone else in the UK, has “categorically ruled out” bidding for the business founded in South London in 1921 which now has more than 50 branches.

Active Capital, which also owns the fast casual dining chain Leon, is said to have appointed the Canada-based firm Canaccord Genuity to handle any potential sale.

The Telegraph says that Sports Direct wants to expand into cycling, but adds that a potential stumbling block to any deal is whether brands such as Specialized and Trek would continue to supply Evans should it be bought by the retailer.

Founded in Maidenhead, Berkshire in 1982 as Mike Ashley Sports, from the late 1990s on the business now known as Sports Direct has made a string of acquisitions of sports brands.

In 2002, it acquired London-based sports retailer Lillywhites, including its Piccadilly Circus flagship store, and in 2004 it bought Dunlop Slazenger.

Ashley floated part of the business on the London Stock Exchange in 2007, but remains its majority shareholder.

Simon joined road.cc as news editor in 2009 and is now the site’s community editor, acting as a link between the team producing the content and our readers. A law and languages graduate, published translator and former retail analyst, he has reported on issues as diverse as cycling-related court cases, anti-doping investigations, the latest developments in the bike industry and the sport’s biggest races. Now back in London full-time after 15 years living in Oxford and Cambridge, he loves cycling along the Thames but misses having his former riding buddy, Elodie the miniature schnauzer, in the basket in front of him.

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51 comments

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ianrobo replied to truffy | 9 years ago
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truffy wrote:
ianrobo wrote:

In fact Decathlon surely offers that service and is good.

And has a fraction of the coverage.

yes that is a shame as when I first started the gear as good and cheap. Plus the BTWin bikes get good reviews.

not sure on top brand names how they can reduce the price that much so compared to wiggle whose margins have to be small.

should add when I look at the difference in cost online between the two there are only marginal differences.

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Beefy | 9 years ago
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I actually find Evans too expensive for such a big chain. After reading about the poor treatment of staff, I can't see how Ashley could be any worse. From a consumer point of view if they can retail goods as cheaply as sports direct I think the likes of wiggle might have some competition. I work bloody hard for my money and to be honest value for money is very important, if this is offered I will buy.

The Evans in Liverpool has appalling staff levels as when I visited them with my brother who is a frequent customer we stood around for 10 minutes waiting for the opportunity to give them money! One staff was with a customer and the other thought talking to an area manager more important that a £60 sale. Not a problem when I buy walking gear at sports direct.

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Stumps | 9 years ago
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One thing i will say about Ashley is he will make it a success if he buys the company. As for "tat" sold at Sports Direct, there are some items which could be described as such however due to his buying power he sells a lot of good gear, such as Asics, Nike, Adidas etc, at much cheaper prices than say JD Sports.

I get all my trainers, tracksuits plus my kids football boots and kit from there and i've saved a fortune.

My mate plays golf (about a 10 handicap) and he gets all his gear from there as again its good quality and much cheaper.

Just because its Mike Ashley dont give it a miss you could be much better off.

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andyp | 9 years ago
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'I never shop at Evans, but I wouldn't wish mike Ashley / sports direct on them '

I do shop at Evans, but if Ashley took over I wouldn't shop there again.

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JamesJ | 9 years ago
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I like Evans prices. They do price match with the big online sellers and you can then exchange Tesco clubcard vouchers for Evans vouchers of double the value. I suspect they're not making a lot of money out of me.

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hampstead_bandit | 9 years ago
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@jimmyd

I was a workshop manager for 2 large Evans stores in London; non-management staff (i.e. sales assistants and mechanics) were on minimum wage (although could make a reasonable bonus if the store traded well), and hours were not guaranteed

Every autumn we'd start shedding staff as hours were cut to the minimum, staff would leave (try surviving in London on 14 hours a week), we'd be understaffed during the winter, and then have to recruit in the Spring, meaning a constant churn of staff, and lack of experienced staff.

Evans did try recruiting "cashiers" but soon realized that even a basic sales assistant in the bike industry needs to have some knowledge of bikes, to sell just the right inner tube.

Eventually the permanent staff would get fed up, find a slightly better paid job in a LBS, or depart the bike industry.

Bike shops in London have a real problem with being able to recruit and retain competent staff, especially mechanics - bike shops are competing with a wide range of employers in different sectors, 'loving your job' sounds nice but when its minimum wage and uncertain hours, that love only goes so far.

To be fair to Evans, its not unique to them, most chain retailers (including Cycle Surgery, and high street i.e. not bike industry ) operate this way.

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Housecathst | 9 years ago
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A Wiggle / Bridgepoint Capital deal could be interesting, it's no secret that they are looking for a presents on the high street.

I never shop at Evans, but I wouldn't wish mike Ashley / sports direct on them

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leqin replied to Housecathst | 9 years ago
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Housecathst wrote:

A Wiggle / Bridgepoint Capital deal could be interesting, it's no secret that they are looking for a presents on the high street.

I never shop at Evans, but I wouldn't wish mike Ashley / sports direct on them

My guess is that Wiggle, if they managed to take over, would hire a few people to ride bikes around dropping bags of Haribo - hence fulfilling your dream of 'presents' on the high street  16 .

Wiggle - if you do want to make a bid and you do win through then howsabout me being able to order online and you drop of my order at my nearest Wiggle store and I call in and pick it up just like I can with Amazons lockers at my local co-op on my evening commute home.

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Judge dreadful | 9 years ago
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Well if it happens, and Mike Ashley can wield his massive bulk buying powers, it could be very good news, stuff will be cheaper. If he try's to turn it into another Chav emporium, and the quality suffers in favour of pure quantity, maybe not so good.

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EddyBerckx | 9 years ago
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What he did to lillywhites was criminal...and whatever you think of Evans...just think how bad it could get with him at the helm.

And I'm sure the Evans staff inc mechanics are really gonna be happy on minimum wage zero hour contracts...

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freespirit1 replied to EddyBerckx | 9 years ago
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StoopidUserName wrote:

What he did to lillywhites was criminal...and whatever you think of Evans...just think how bad it could get with him at the helm.

And I'm sure the Evans staff inc mechanics are really gonna be happy on minimum wage zero hour contracts...

I'm not 100% on this but surely the TUPE regulations will come into play on this, as this is a sale.

If Evans was being brought from administrators the TUPE rules don't apply.

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jimmyd replied to EddyBerckx | 9 years ago
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Well having worked at Evans Cycles twice in my career I can confirm that All the mechanics and shop floor staff are already on minimum wage. My first contract was zero hours.

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spasypaddy replied to EddyBerckx | 9 years ago
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StoopidUserName wrote:

What he did to lillywhites was criminal...and whatever you think of Evans...just think how bad it could get with him at the helm.

And I'm sure the Evans staff inc mechanics are really gonna be happy on minimum wage zero hour contracts...

by and large a lot of the staff already are on minimum wage and zero hour contracts.

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Airzound | 9 years ago
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Halfords or Sports Direct buying Evans - which is worse?

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Stumps | 9 years ago
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Mike Ashley likes nothing more than making money so i cant see him buying Evans, there isn't enough money in it.

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russwparkin | 9 years ago
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evans as well as crc work on a really silly margin, something along the lines of 4% profit margin.

tesco etc have a similar thing but obviously turn over billions so make hundreds of millions.

not sure about evans but i got told crc only made a 1/2 million profit last year, still a good profit in a sense but terrible if your turning over 100 million.

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joe24737 | 9 years ago
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"Sports Direct has made a string of acquisitions of sports brands"....and pretty much destroyed each and every one.

And what happened to Field and Trek that Sports Direct acquired? I seem to remember most of the top brands disappeared from their stores before they vanished from the High Street.

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joemmo replied to joe24737 | 9 years ago
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joe24737 wrote:

"Sports Direct has made a string of acquisitions of sports brands"....and pretty much destroyed each and every one.

And what happened to Field and Trek that Sports Direct acquired? I seem to remember most of the top brands disappeared from their stores before they vanished from the High Street.

Field and Trek, amongst others basically exist as a branded 'outdoor sport corner' amongst the tracksuits and replica tat in sports direct shops, likewise the other brands. I've no real love for Evans but god help them if Ashley gets his grubby hands on them.

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JonD replied to joemmo | 9 years ago
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joemmo wrote:

Field and Trek, amongst others basically exist as a branded 'outdoor sport corner' amongst the tracksuits and replica tat in sports direct shops, likewise the other brands. I've no real love for Evans but god help them if Ashley gets his grubby hands on them.

Not exactly.
A brief search on the F&T site seems to show 8 *stores* inc Ambleside, Betws y Coed, Matlock, Stratford, Bournemouth, and my neck of the woods, Guildford - quite a small outdoor-only store but I've used them a few times in recent years. I dont know how the fortunes of F&T are related or wrt timescale, , but bear in mind Millets/Blacks have had their own problems which resulted in a lot of store closures.

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Ginsterdrz | 9 years ago
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Does Evans make money?
Liverpool branch is always empty when I go in.
I then recoil at the prices and leave!

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PonteD replied to Ginsterdrz | 9 years ago
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Ginsterdrz wrote:

Does Evans make money?
Liverpool branch is always empty when I go in.
I then recoil at the prices and leave!

I rarely pay full price for anything at Evans. I always find something I want, then find it cheaper elsewhere then price match it with Evans so I can pick it up on the way home from work (saves waiting 2 days for it to get delivered).

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