The US athlete joins the German bicycle manufacturer Canyon.
(Photo: AP)
Munich LeBron James is not only the highest paid basketball player in the world. He is also a passionate cyclist. The American has already cycled to NBA games, and he donated bikes and helmets to a school for every child. “If you had a bike, you could let it go and be free,” he once told the Wall Street Journal, referring to his own childhood.
Now the basketball icon is joining the German bicycle manufacturer Canyon. James takes a stake in the mail order business through his investment firm LRMR, which he runs with his longtime business partner and ex-manager Maverick Carter. The two will help drive the expansion of Canyon’s US business.
This shows once again that the bicycle industry has gained in importance for international investors since the bicycle boom in the time of Corona. According to industry estimates, Canyon was taken over by the investment company Groupe Bruxelles Lambert (GBL) at the end of 2020 for EUR 800 million. The Belgians remain majority owners.
In addition to LRMR, the US private equity firm SC Holdings, which has stakes in brands such as Athletic Greens, Hyperice and Just Women’s Sports, also joined the new round of financing. “We weren’t actively looking for new investors,” said Canyon founder Roman Arnold. “But LRMR and the SC team immediately understood our mission to create the most inspiring and innovative bicycle company in the world.”
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According to Forbes magazine, basketball pro LeBron James was one of the five highest-earning athletes in the world last year. His income, including sponsorship deals, was $96.5 million, according to the ranking. He last won the NBA title in 2020 with the Los Angeles Lakers and was voted the most valuable player in the final series.
Again and again he was involved in the bicycle sector. For example, he took part in the “Critical Mass”, where cyclists from all over the world call for a better infrastructure. He was also temporarily involved in Cannondale.
LeBron James invests in the sports industry
He is also otherwise very active as a businessman. Among other things, he joined Liverpool with LRMR in 2017 and is a partner in the Fenway Sports Group, which has a stake in the Boston Red Sox. LRMR Ventures is also active in marketing and media production. James also has a stake in the tequila brand Lobos 1707.
He did many of his engagements with Maverick Carter. “As an enthusiastic cyclist and brand developer, I am very much looking forward to the partnership with Canyon,” he said about joining Canyon. The quality of the products, the strength of the brand and the unique sales model offer many opportunities.
Canyon is one of the pioneers in online bicycle retail. The brand is also used by professional cyclists, for example in the Tour de France. According to industry estimates, the company should achieve sales in the mid three-digit millions. According to information from the Handelsblatt, the new US investors paid 30 million euros from financial circles for their smaller minority holdings. Canyon was thus valued at 750 million euros.
“Canyon’s impact on cycling and culture can be felt everywhere, from the pros on the Tour to the recreational cyclist on the roads and trails of the world,” said Jason Stein, founder of SC Holdings. He is looking forward to “taking advantage of the growth opportunities in the USA”.
During the pandemic, many people had rediscovered cycling. According to the ZIV industry association, sales of bicycles and e-bikes in Germany increased only slightly to 6.6 billion euros last year. But that was due to the lack of availability of parts and bikes. For comparison: In 2018, sales were just over three billion euros.
With growing sales, the industry has also become more interesting for investors and consolidation is taking place. At the beginning of the year, a consortium led by the investment company KKR announced the takeover of the Dutch manufacturer Accell Group with brands such as “Batavus” and “Sparta” for around 1.6 billion euros.
Last year, the Dutch group Pon Holdings took over the bicycle subsidiary of the Canadian conglomerate Dorel Industries for 700 million euros. Pon secured brands such as Cannondale and Schwinn and doubled sales in the bicycle business to around 2.3 billion euros.
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