It's 25 years since wholly Kiwi-owned brand Avanti first launched, and if that wasn't an auspicious enough milestone, the company is set to acquire the bicycle division of Pacific Brands next month, effectively doubling its turnover.
Part of the Sheppard Group, which has operated successfully in the bicycle industry for over 30 years, Avanti says the purchase will consolidate its position as a formidable competitor in the Australian and New Zealand bicycle markets.
Sheppard managing director and owner John Struthers said the acquisition was the biggest in its history and would see Avanti's turnover double.
Completion of the sale and handover of the business is scheduled to take place on September 1.
The purchase is a "strategic" one, he said, and will deliver economies of scale across marketing, warehousing and product development.
Struthers said the company was now considering moving its Melbourne office and administration functions to the Pacific Brands bike division headquarters in Victoria.
"With an acquisition of this size we are initially focused on ensuring we do not disrupt the service level of both business units," he said. "Pacific Brands logistics will continue to support us for some time to ensure the transition is as smooth as possible.”
In an interview published in the latest Idealog, Struthers said the company was starting to take a more proactive approach to exporting. As well as courting opportunities in Europe, last year it entered into a joint venture with Singapore-based company Bikeplus, which now sells Avanti in its showroom and online.
The business operates as a successful wholesaler, distributor and retailer in New Zealand and Australia. Its retail chain, AvantiPlus, launched in 2003 and now has 32 stores in New Zealand and 50 in Australia. It's expecting collective turnover of more than $100 million in the coming year, and plans to hit the 100-store mark across Australasia within two years.
And while Avanti's New Zealand revenue is growing steadily, it's the Aussie market that accounts for 60 percent of overall sales and is ripe for future growth.
The general manager of its overall Australian operation, Steve Paraskevas, said the acquisition "will bring real benefits to bicycle retailers, our teams and the brands involved for both Australia and New Zealand”.
Paraskevas is a former general manager at Pacific Brands' bicycle division, and says the deal will bring together a "huge pool" of talent on both sides.
“We have a lot of confidence that we will have the best team in the industry," he said.
“We will have the most compelling range of product in the market, and with the collective group of brands and a wider distribution network we will be able to channel more investment into areas such as marketing and product development to continue to help grow cycling in Australia and New Zealand."
Brian Gillin of Pacific Brands said it would take all the brands involved to a new level.
"There will be strong benefits for all our dealers, giving them a strong and focused distribution partner."